What would it cost an insurance company to replace a family’s personal property that originally cost $113,000? The replacement costs for the items have increased by 12 percent.
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What would it cost an insurance company to replace a family’s personal property that originally cost $113,000? The replacement costs for the items have increased by 12 percent.
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- What would it cost an insurance company to replace a family’s personal property that originally cost $105,000? The replacement costs for the items have increased by 14 percent.If a product in question has an insignificant cost, it might not be worth the trouble to trace the cost of that item to a particular cost center, and that item would be considered indirect. If the cost of tracing the cost of that item is high in relation to the benefits received from tracing it, the item would likely be considered as indirect material. If the design of the manufacturing process easily permits all the items to be traced to a single type of cost center, then it would be easy for a company to consider that material to be direct. Overall, the direct/indirect classification is decided on a cost/benefit basis. In your response to this discussion, state why is it possible that a raw material such as glue might be considered as an indirect material for one furniture manufacturer and as a direct material for another furniture manufacture? Also for this discussion, what are the differences between direct costs and indirect costs? Give an example of each.“Did the Austin wedding contract you were working on go out yet?” asked Tonya Roberts, the executive director of the downtown convention center operated by the city of Springdale. “Yes, I mailed it to them yesterday after we talked about it,” replied Lara, the Center’s DOSM and revenue manager for space rental. “Why do you ask?” “I just got off the phone with the mayor’s office. They want to hold a big fundraiser for his reelection campaign in the ballroom the same night the Austin wedding wanted to reserve it. The wedding was for 200 people right?” continued Tonya. “That’s right. 200 people at about $150 a head; it’s a nice piece of business. About $30,000,” said Lara. “Well the mayor expects 1,000 people, at $100 per person. And don’t forget, he’s the boss. We can’t hold both events. I need you to call the Austins and tell them you made a mistake. Tell them the room is already booked that night. They’ll need to find another space.” What would you advise Lara to do if she asked you…
- Because full costing is accepted for financial reporting purposes and variable costing is not, whyshould we be concerned about the difference between them? What is the difference, and why is itimportant?Many restaurants have unbundled their products to lower prices. For example, some restaurants that normally included a salad bar with all meals now offer a dinner price that includes the salad bar and a lower à la carte price that does not. Why do you think these restaurants are unbundling their products? When is product bundling effective?mWhat are CDI and BDI? Explain each in detail, including what they are used for. Suppose you have a CDI of 200 and a BDI of 90. What would this indicate to you? And finally, what would the strategic implications of a CDI of 200 and a BDI of 90 be for this brand?
- Maryann is visiting Germany for the first time and she would like to take some guided tours but doesn’t know what is available. After doing some research, she finds a walking tour of Munich that fits her schedule and budget, imagines herself taking the tour, and decides to buy it. But to be safe, she then asks her friend what she thinks about the tour. Maryann has used the ________ process to make a decision.Large corporations such as Sears and Walmart enter into contracts with manufacturers to ensure that they have a secure supply of products. The manufacturers in turn try to secure large contracts by offering bulk discounts. How can corporations compare these bulk discount schemes? Suppose that vendor A promises the first 100,000 units at $1, the next 200,000 units at $0.8, and the units after that at $0.7. Vendor B promises the first 200,000 units at $1.1, the next 300,000 units at $0.7 and the units after that at $0.6. The contract is as follows. The corporation observes the demand, and then orders the units from the vendor. The vendor manufacturers these units and ships them off. At the time when the corporation must decide on the vendor, the demand is unknown, but this demand can be modeled with a Normal distribution with mean of (500,000) units with a standard deviation of 140,000. Which vendor should the corporation choose? Why? Please discuss considerations of expected cost as…A company has $500 million in total assets, $10 million in notes payable, and $45.6 million in long-term debt. What is the debt ratio?
- You purchased a mechanical keyboard for P45 and plan to resell it for P63. What would the markup rate on this keyboard be?Some high-fashion retailers, notably H&M and Zara, sell what some call“disposable fashion”—apparel priced so reasonably low that it can bedisposed of after just a few wearings. Here is your dilemma: You havean important job interview and need a new suit. You can buy the suit atone of these stores for $129 or at Brooks Brothers for $500. Of course,the Brooks Brothers suit is of higher quality and will therefore lastlonger. How would you use the two value-based approaches describedin this chapter to determine which suit to buy?You own Athleticon, which manufactures athletic wear. Your new contract with Atlanta United, a professional soccer team, allows Athleticon to be the sole suppler of athletic wear with the “Atlanta United” logo. No one lese can manufacture athletic wear with the “Atlanta United” logo. What do you think will be Athleticon’s level of profitability on the sale of “Atlanta United” athletic wear? Explain why. Your contract with Atlanta United only lasts 3 years. It was not renewed. Other firms can now manufacture athletic wear with the “Atlanta United” logo 2. What would you expect to happen to the price of “Atlanta United” athletic wear? Explain why.