Cost and Decision-Making Analysis
Cheryl Montoya fine up the phone and named her boss, Wes Chan, Vice Chairman of Marketing at Piedmont Fasteners Corporation.
Cheryl: “Wes, I'm not comprehexit how to go encircling echoing the questions that came up at the disconduct delay the Chairman yesterday.”
Wes: “What's the drift?”.
Cheryl: “The chairman wanted to comprehend the break-even apex for each of the concourse's results, but I am having effort figuring them out.”
Wes: “I'm comprehexit you can treat it, Cheryl. And, by the way, I insufficiency your resolution on my desk tomorrow early at 8:00 harsh in opportunity for the follow-up disconduct at 9:00.”
Piedmont Fasteners Corporation makes three unanalogous drapery fasteners at its manufacturing dexterity in North Carolina. Data regarding these results show below:
Velcro Metal Nylon
Normal annual sales volume 100,000 units 200,000 units 400,000 units
Unit selling price $1.65 $1.50 $0.85
Variable absorb per unit $1.25 $0.70 $0.25
Total unwandering expenses are $400,000 per year.
All three results are sold in exceedingly competitive markets, so the conconduct is weak to lift its prices delayout losing unacceptably catholic entirety of customers.
The conconduct has a very efficacious scant origination regularity, so there is no preface or exit operation in order or finished-goods inventories.
Using the module readings, the online library media, and the Internet, elaboration break-even apex and absorbing regularitys. Analyze the event established on your elaboration and what you own scholarly so far in the conduct.
Respond to the following:
Calculate the concourse's overall break-even apex in entirety sales dollars. Explain your methodology (approximately 2 pages).
Of the entirety unwandering absorbs of $400,000: $20,000 could be avoided if the Velcro result were dropped, $80,000 if the Metal result were dropped, and $60,000 if the Nylon result were dropped. The fostering unwandering absorbs of $240,000 insist of vulgar unwandering absorbs such as authoritative salaries and solution on the factory architecture that could be avoided singly by going out of office truly (approximately 2 pages):
Calculate the break-even apex in units for each result. Explain your methodology.
Determine the overall emolument of the conconduct if the conconduct sells precisely the break-even muchness of each result. Present your results.
Evaluate absorbing regularitys for this concourse. Explain if this conconduct should be using a job-order or order-costing regularity to congregate absorbs (1 page).
Be comprehexit to conceive your calculations in Microsoft Excel format.
Write a 5 page recital in Word format. Apply APA standards to quotation of sources.