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Strayer ACC 499 Problem Solution Guide




Question;EXERCISE 21 LO.4 (Target costing) Taurus Tools has developed a new kitchen;utensil. The firm has conducted significant market research and estimated the;following pattern for sales of the new product: Expected Price Year Expected;Volume per Unit 1 38,000 units $19 2 48,000 units 18 3 90,000 units 16 4 40;000 units 12 If the firm desires to net $4.50 per unit in profit over the life;of the product, what is the target cost to produce the new utensil?;Exercise 29 LO.5 (JIT implementation) William Manufacturing Company began;implementing a just-in-time inventory system several months ago. The production;and purchasing managers, however, have not seen any dramatic improvements in;throughput. They have decided that the problems are related to their suppliers.;The company?s three suppliers seem to send the wrong materials at the wrong;times. Prepare a discussion of the problems that might exist in this situation.;Be certain to address the following items: internal and external communication;possible engineering changes and their impacts, number, quality, and location;of suppliers, and length of system implementation.;EXERCISE 28 LO.4 (EVA) Mountain Mist Inc.?s cost of capital is 11 percent.;In 2008, one of the firm?s divisions generated an EVA of $1,130,000. The fair;market value of capital investment in that division was $26,500,000. How much;after-tax income was generated by the division in 2008?;EXERCISE 39 LO.4 (ROI) Spruce Enterprises operates a chain of lumber stores.;In 2008, corporate management examined industry-level data and determined the;following performance targets for lumber retail stores: Assets turnover 1.7;Profit margin 80% The actual 2008 results for the company?s lumber retail;stores follow: Total assets at beginning of year $10,200,000 Total assets at;end of year 12,300,000 Sales 28,250,000 Operating expenses 25,885,000 a. For;2008, how did the lumber retail stores perform relative to their industry;norms? b. Where, as indicated by the performance measures, are the most likely;areas to improve performance in the retail lumber stores? c. What are the;advantages and disadvantages of setting a performance target at the start of;the year compared with one that is determined at the end of the year based on;actual industry performance?;EXERCISE 48 LO.6-LO.8 (Performance measurement, BSC) For each of the;following items, indicate two performance measurements that could be obtained;from a cost management system. Classify each item into one of the four balanced;scorecard perspectives.;a. Quality;b. Cost;c. Production line flexibility;d. People productivity and development;e. Inventory management;f. Lead time;g. Responsive after-sale service;h. Customer satisfaction and retention;i. Product and process design;j. Manufacturing planning process;k. Procurement process;l. Manufacturing process;m. Management accomplishment;n. Marketing/sales and customer service;o. Delivery performance;p. Financial accounting services


Paper#41414 | Written in 18-Jul-2015

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