Introduction
Thicket Wood Ltd. is a well-known, high quality custom and handcrafted manufacture of kitchen cabinets. It is located in Kitchener, Ontario and sold most of
The current production process that Thicketwood Ltd is utilizing can no longer keep with the demand of custom kitchen cabinets. Management must implement a new step to the production line to increase efficiency; however, they must also maintain quality as the customers that are purchasing these cabinets expect top quality for the amount of money they are paying.…
i. CLC must improve their current ratio to ensure the bank it will have the ability to repay a larger loan.…
To assume role of Chris Mell, CMA, and prepare a report for the President and CEO Andrew Mayd. This report will advise him on how to address issues facing organization and items discussed at the management meeting.…
Filmore Furniture Ltd. manufactures colonial maple furniture. The company was incorporated in 1970 by Fred…
A. This company now faced the cash shortage trouble which we can see from its liquidity, such as current ratios, quick ratios and return on sales for these three years, following a decreasing trend. From accounts receivable statistics, we learn the cash inflows is decreasing since it takes longer time to collect the money from customers. And they still need to pay for purchases, so borrowing from banks can destress the cash shortage pressure and expand their sales to a new extent.…
The Chabros International Group started with fairly low-key beginnings in the late sixties, but has gradually become a respected name in a wealth of different timber markets. In particular, it has become a well-known wood and veneer supplier due to the relentless and often pioneering efforts of its president Antoine Chami, who has carefully built up a reputation for high quality products and exceptional service. The company employs more than 600 staff with an annual turnover of $100 million USD.…
The Campbell Company is evaluating a proposal to buy a new milling machine. The base price is $108,000, and shipping and installation costs would add another $12,500. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $65,000. The machine would require a $5,500 increase in working capital (increased inventory less increased accounts payable). There would be no effect on revenues, but pre-tax labor costs would decline by $44,000 per year. The marginal tax rate is 35 percent.…
Storage Systems, Inc., sells a wide range of drums, bins, boxes, and other containers that are used in the chemical industry. One of the company’s products is a heavy- duty corrosion- resistant metal drum, called the XSX drum, used to store toxic wastes. Production is constrained by the capacity of an automated welding machine that is used to make precision welds. A total of 2,000 hours of welding time are avail-able annually on the machine. Since each drum requires 0.8 hours of welding time, annual production is limited to 2,500 drums. At present, the welding machine is used exclusively to make the XSX drums. The accounting department has provided the following financial data concerning the XSX drums:…
Marketing: In business, firm marketing generates the revenues that the financial people manage and the production people use in creating goods and services. The challenge that faces marketing is to generate those revenues by satisfying customers’ wants at a profit and in a socially responsible manner.…
Flowton product enjoys a steady demand for stainless steel infiltrators used in anumber of chemical processes. Revenues from the infiltrator division are $50million a year and production cost are $47.50. However, the high-precisionMunster stamping machines that are used in the production process are coming tothe end of their useful life. One possibility is simply to replace each existingmachine with a new Munster. These machines would cost $800000 each and wouldnot involve any addition operating costs. The alternative is to buy 10 centrallycontrolled skilboro stampers. Skilboro cost $1.5 million each, but compare to theMunster, they would produce a total saving in operator and material cost of $500000 a year. More over the skilboro is sturdily built and would last year,compared with an estimated 7-year life for the Munster Analysts in the infiltrator division have produced the accompanying summarytable, which show the forecast total cash flows from the infiltrator business over the life of each machine. Flowstone¶s standard producers for appraising capitalinvestments involve calculating net present value, internal rate of return, and payback and these measures are also shown in table.As usual, Emily balsam arrived early at flowstone¶s head office. She had never regretted joining flowstone. Everything about the place, from the mirror windowsto the bell fountain in the atrium suggested a classy outfit. Ms. Balsam sighedhappily and reached for the envelope at the top of her in-tray. It was analysis fromthe infiltrator division of replacement options for the stamper machines. Pinned tothe paper was summary table of cash flows and note from the CFO, which read,³Emily, I have read through 20 pages of excruciating detail and I still don¶t knowwhich of these machines we should buy. The NPV calculation seems to indicatethat the Skilboro is best, while IRR and payback suggest the opposite. Would youtake a look and tell me what we should do and…
The firm is contemplating a plant modernization to upgrade existing equipment, which should increase the plant’s output while lowering energy costs. Using the current equipment, around 1.500 pounds of salmon can be processed each hour, while the new plant would be able to processed each hour, while the new plant would be able to process 2.000 pounds per hour. The updated equipment is made by the same manufacturer as the existing equipment, and the new equipment quickly. For this reason, costs to train personnel are assumed to be negligible. The production manager, Bjorn Pedersen, is skeptical about undergoing the plant modernization. The older equipment, he argues, is already paid for, and new equipment would cost $10.000 per week. This cost is comprised of both principal and interest, and includes manufacturer installation of the equipment. The controller, Maret Karlsen, cautions that all decisions related to costs should be included in the analysis and that because the energy consumption would be different, this must also be accounted for in the decision. Energy costs are presently $10 per unit,…
Quality Parts Company is an enterprise that supplies gizmos for a computer manufacturer. There are three products (X, Y, Z), and basically all of them need the same machines, except for product Z which has milling as the first operation. The demand can range from one hundred and twenty five to one hundred and seventy five products per month. Another important consideration to make about this enterprise is that it has a subassembly which gives products directly to the middle of the plant.…
This assignment consists of two case studies, the Simpson and Selph Ltd and the Fly – by – Nights Airlines. Case Study 1: The Simpson and Selph Ltd, a small carpet manufacturing company located in Macon, Georgia. The Simpson and Selph Ltd are faced with a replacement of their carpet – binding machine. The Machine to be replaced was purchased five years ago and has depreciated to zero. They have two carpet – binding machines to choose from, the Harley Model, same brand they are replacing and the Davidson. Brian Douglas, a corporate financial analyst for Simpson and Selph Ltd is charged with evaluating the replacement of a carpet – binding machine. They have two sets of the Harley and the Davidson. Brian Douglas needs to do a financial analysis to consider and choose the appropriate machine for the company. Brian must advise on what machine to be bought that would be a more viable option. Case Study 2: The Fly – by – Night Airlines, a major commercial air carrier offering passenger service between most large cities in the United States. One of its profitable routes is between Los Angeles and New York. Due to the intense competition on this route, Fly – by – Night Airlines considers upgrading the quality of the fleet of Aircraft used on the Los Angeles to New York route. James “Red” Baron is a supervisor of transcontinental operations for Fly – by – Night Airlines. As it has in the past, Fly – by – Night Airlines plans to purchase all its new planes from Puddle Jumper Aircraft Company. At the…
Problem 1 The Commonwealth Company uses a job-order cost system and applies manufacturing overhead cost to jobs using a predetermined overhead rate basedon the cost of materials used in production. At the beginning of the year, the following estimates were made as a basis for computing the predetermined overhead rate: manufacturing overhead cost,$186,000; direct materials cost,$155,000. The following transactions took place during the year (all purchases and services were acquired on account): a. b. c. d. Raw materials purchased,$96,000. Raw materials requisitioned for use in production (all direct materials), $88,000. Utility bills incurred in the factory,$17,000. Costs for salaries and wages incurred as follows: Direct labor, $174,000 Indirect labor,$70,000 Selling and administrative salaries, $124,000 Maintenance costs incurred in the factory,$12,000. Advertising costs incurred,$98,000. Depreciation recorded for the year, $75,000 (75% relates to factory assets and the remainder relates to selling and administrativeassets). Rental cost incurred on buildings, $80,000 (80% of the space is occupied by the factory, and 20% is occupied by sales and administration). Miscellaneous selling and administrative costs incurred, $12,000. Manufacturing overhead cost was applied to jobs. Cost of goods manufactured for theyear, $480,000. Sales for the year (all on account) totaled $900,000. These goods cost $550,000 to manufacturee. f. g. h. i. j. k. l.Requirements: Prepare journal entries on the following page to record the information above.1MANAGEMENT 122 Problem 1 Solution: Account a. Raw…
Monroe Clock Company has been making decorative electric clocks and later switched to making electric timing mechanisms for producers of timed electrical appliances. Monroe is interested in making a new timer, but they have to decide if the costs will be reasonable enough to deal with and still make profit. Monroe tried calculating its costs for the new timer. Unfortunately, they come up with high production costs, which could lead to consumers not willing to buy the item. The company has to decide how costs will be allocated and what price to charge consumers. This decision has to be done carefully or Monroe could end up making no profit.…