Current Attempt in Progress Blossom provides environmentally friendly lawn services for homeowners. Its operating costs are as follows Depreciation $1,400 per month Advertising $200 per month Insurance $3,680 per month Weed and feed materials $13 per lawn Direct labor $16 per lawn Fuel $3 per lawn Blossom charges $80 per treatment for the average single-family lawn. (a) Determine the company's break-even point in number of lawns serviced per month. Break-even point lawns
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- Blue Spruce provides environmentally friendly lawn services for homeowners. Its operating costs are as follows. Depreciation $1,400 per month Advertising $200 per month Insurance $8,000 per month Weed and feed materials $13 per lawn Direct labor $25 per lawn Fuel $2 per lawn Blue Spruce charges $80 per treatment for the average single-family lawn. Determine the company's break-even point in number of lawns serviced per month. Break-even point lawns Determine the company's break-even point in dollars. (Round answer to 0 decimal places, e.g. 1,225.) Break-even point $4E19-8 All/That Blooms provides environmentally friendly lawn services for homeowners. Its operáting costs are as follows. Depreciation Advertising $1,400 per month $200 per month month $2,000 per $12 per lawn $10 per lawn $2 per lawn Insurance Weed and feed materials Direct labor Fuel All That Blooms charges $60 per treatment for the average single-family lawn. Instructions Determine the company's break-even point in (a) number of lawns serviced per month and (b) dollars. The inn has 50 CoQuestion: The management of Health Supplement Inc. wants to reduce its labor cost by installing a new machine. Two types of machines are available in the market – machine X and machine Y. Machine X would cost $18,000 where as machine Y would cost $15,000. Both the machines can reduce annual labor cost by $3,000.Required:Which is the best machine to purchase according to payback method?
- 2. Foxx Company manufactures water sealant. This sealant is used to stop leaks in basement orin concrete retainer walls. In 2019 the company sold 1.6M gallons of sealant at price of P3.00per gallon with a variable cost per gallon of P1.50. The fixed costs were P1,550,000In 2020, new automated equipment will be used in production. This will increase fixed costsfor the year to P1,785,000. The variable cost per gallon has been estimated at P1.30 per gallon.The sales volume increased by 15% percent in 2020.Required:1. For 2019 compute the BEP in gallons and pesos.2. For 2020 compute the BEP in gallons and pesos.3. How much is the EBIT for 2019 & 20204.Using the cost and revenue data for 2019 consider each of the following situationsindependently:a. What is the effect on the break even point (in gallons) for the decrease in variable cost fromP1.50 to P1.30?b. What is the effect on the break even point for the increase in fixed costs of P235,000?Pet Hotel, Inc. operates three luxury pet boarding facilities and expects the following results for the coming year. {picture} Answer each of the following questions independently. 1. Fixed costs are all allocated and unavoidable. What will happen to profit if Pet Hotel discontinues operations at Pet Spa? 2. Suppose now that $25,000 of the fixed costs shown for Pet Spa is avoidable. What will happen to total profits if Pet Hotel discontinues operations at Pet Spa?The Lombard Company produces and sells office-space dehumidifiers to companies that own or rent office space. (a) Lombard’s materials and labor costs for producing the dehumidifiers are $3,000 per unit and the fixed costs of its dehumidifier production plant are $1.85 million. If Lombard sells a dehumidifier for $5,000 per unit, what is its percent contribution margin? Show your work. (b) If Lombard used revenue-based compensation to pay its sales force, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (c) If Lombard used the profit-based compensation method described in the course to pay its sales force and sets the dehumidifier’s target price at $5,000 per unit, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (d) Explain the benefit to Lombard’s management of using the profit-based compensation method of Part (c) over revenue-based compensation for…
- In order to carry a new investment project, company A has to purchase a machine for OMR 400,000. Company A staff have enough capacity to carry out the production, no one new will need to be hired, they are currently paid OMR 20,000. Calculate the relevant cost? a. OMR 20,000 Ob. OMR 380,000 O c. OMR 400,000 d. OMR 420,000To recover the waste heat from the processed fluid, a chemical industry planned to invest in a heat exchanger. Company has 4 investment options namely HE1, HE2, HE3 & HE4. Company expected at least 20 % annual return before taxes based on the purchased cost. HE1 HE2 HE3 HE4 Purchased Cost (OMR) 13000 17000 20000 38000 Maintenance Cost (as % of purchased cost) 18 20 25 22 Operation Cost (OMR) 4500 6000 8000 9000 Energy Saving (OMR) 12000 15000 18000 25000 Suggest the suitable heat exchanger to the company based on the following methods. Justify the statement. a) Incremental investment returns method b) Minimum return as a cost methodA company is planning to install a new automated plastic-molding press. Two different presses are available. Information for these two mutually exclusive alternatives are as follows: Press 1 Press 2 Investment cost $49,600 ??? Annual expenses $25,192 $22,880 Reject rate 2.6% 5.6% Both presses are capable of producing 120,000 units per year. Non-defective units are sold for $0.375/unit (rejected units are worthless); the selected analysis period is five years; and the MARR = 10%. Find the breakeven investment cost of Press 2. %3D
- Searching for ways to cut costs and increase profit, one of the industrial engineers at Home Comfort Furniture Manufacturers, Inc. determined that the equivalent annual worth of an existing machine over its remaining useful life of 2 years is $-71,000 per year. The IE also determined that used machines like the one currently in use are not available any longer, but the defender can be replaced with a challenger that is more advanced. It will have an AW of $-83,550 if it is kept for 2 years or less, $-75,075 if it is kept between 3 and 4 years, and $-65,000 if it is kept for 5 to 10 years. If the company uses a specified 3-year planning horizon and an interest rate of 14% per year. a) Determine when the company should replace the machine. b) Determine the AW for the next 3 years. a) The company should [Keep the machine for 2 years and then replace with the challenger b) The AW for the next 3 years is $Two altemnative machines will produce the same product, but one is capable of higher-quality work, which can be expected to return greater revenue. The following are relevant data. Determine which is the better alternative, assuming repeatability and using SL depreciation, an income-tax rate of 25%, and an after-tax MARR of 10%. Capital investment Life Machine A $20,000 12 years $3,500 Calculate the AW value for the Machine A. AWA (10%) = $(Round to the nearest dollar.) Terminal BV (and MV) Annual receipts Annual expenses Click the icon to view the interest and annuity table for discrete compounding when the MARR is 10% per year. Machine B $34,000 9 years $2,000 $144,000 $142,000 $190,000 $163,000-1 The Rainier Company provides landscaping services to corporations and businesses. All its landscaping work requires Rainier to use landscaping equipment. Its land- scaping equipment has the capacity to do 10,000 hours of landscaping work. It is currently utilizing 9,000 hours of equipment time. Rainier charges $80 per hour for landscaping work. Cost information for the current activity level is as follows: Revenues ($80 * 9,000 hours) Variable landscaping costs (including materials and labor), which vary with the number of hours worked ($50 per hour * 9,000 hours) Fixed landscaping costs Variable marketing costs (5% of revenues) Fixed marketing costs Total costs Operating income $720,000 450,000 108,000 36,000 72,000 666,000 $ 54,000 Rainier has just received a one-time only special order for landscaping work from Lasell Corporation at $60 per hour that would require 1,000 hours of equipment time. Should Rainier accept the offer even though revenue per hour is less than…