Builder Products, Inc. manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, cooking, is given below for May:

Materials are added at several stages during the cooking process, whereas labour and overhead costs are incurred uniformly. The company uses the weighted average cost method. The company combines labour and overhead into a single cost category—conversion cost.

Required:

Prepare a production report for the cooking department for May. Use the following three steps in preparing your report:

1. Prepare a quantity schedule and a computation of equivalent units.

2. Compute the costs per equivalent unit for the month. (Round your answers to 3 decimal places.)

3. Using the data from parts (1) and (2), prepare a cost reconciliation. (Round "Cost per equivalent unit" to 3 decimal places and the rest to the nearest dollar amount.)

Note: There is difference of "$28" in both the values due to rounding and we feel a note which reads: "Due to rounding, your "Cost accounted for" may not be equal to "Cost to account for"".

13. Now assume that the market for JAMS is a Perfectly Competitive market and that demand in this market is given by Pd=300−1/2Qd. Further assume that Supply in this market is given by Ps=60+Qs

Now assume that Trendsetting Tavares owns one of the firms in the JAMS market and that his Marginal Cost and Total cost are as given below.

MC=60+4q          Total Cost=60q+2q^2

What is the marginal revenue on the 10th Pair of JAMS that Tavares produces?

There are 3 industrial firms in Happy Valley:

The government wants to reduce pollution to 150 units and gives each firm 50 pollution permits.

1. What is the total cost of pollution abatement if the permits are not tradable?

2. What is the total cost of pollution abatement if the permits are traded at a

   price of $20 each?

There are 3 industrial firms in Happy Valley:

The government wants to reduce pollution to 150 units and gives each firm 50 pollution permits.

1. What is the total cost of pollution abatement if the permits are not tradable?

2. What is the total cost of pollution abatement if the permits are traded at a

   price of $20 each?

There are 3 industrial firms in Happy Valley:

The government wants to reduce pollution to 150 units and gives each firm 50 pollution permits.

1. What is the total cost of pollution abatement if the permits are not tradable?

2. What is the total cost of pollution abatement if the permits are traded at a

   price of $20 each?

Martin Mfg produces 1000 lens per month. The following per unit data apply for sales.

Direct materials$400; Direct labor$25; Variable overhead $50 and Fixed overhead $60.

The plant has capacity for 1500 lens.

Solve:

(a)What is the total cost of producing 1000 lens?

(b) What is the total cost of producing 1200 lens and

(c) What is the per unit cost of producing 1200 lens? (Budgeted overhead is $90,000).

1. Becca needs to borrow $143,000 to purchase a new home.  The bank has given her two options; the first is a 20 year loan at 4.35% or the second is a 30 year loan at 4.95%.
   1. How much is the payment for each of these loans?

20-year payment______________    30-year payment ______________

2. What is the total cost of each mortgage?

20-year total cost______________   30-year total cost ______________

3. How much will Becca save if she chooses the 20 year loan? _______________

1. Becca needs to borrow $143,000 to purchase a new home.  The bank has given her two options; the first is a 20 year loan at 4.35% or the second is a 30 year loan at 4.95%.
   1. How much is the payment for each of these loans?

20-year payment______________    30-year payment ______________

2. What is the total cost of each mortgage?

20-year total cost______________   30-year total cost ______________

3. How much will Becca save if she chooses the 20 year loan? _______________

Explain the differences between Economies of Scale and Diseconomies of Scale and explain what factors influence over them. In order to do so, you will have to use the concepts of Short and Long Run average total costs. Remember that in the Short Run Average Total Cost curve, you can find at least one of your assets as fixed and in the Long Run Average Total Cost curve, all the assets are considered variable, meaning that you are assuming the possibility of modifying your production capacity.

The AAA Aquarium Co. sells aquariums for $20 each. Fixed costs of production are $20. The total variable costs are $20 for one aquarium, $25 for two units, $35 for the three units, $50 for four units, and $80 for five units. Create a table showing total revenue, marginal revenue, total cost, and marginal cost for each output level (one to five units). What is the minimum level of output for AAA to produce and not lose money? What is the profit-maximizing level of output?