Assignment 1: Strategic Management and Strategic Competitiveness

 

Choose one (1) public corporation in an industry with which you are familiar. Research the company on its own Website, the public filings on the Securities and Exchange Commission EDGAR database (http://www.sec.gov/edgar.shtml), in the University’s online databases, and any other sources you can find. The annual report will often provide insights that can help address some of these questions.

Write a four to six (4-6) page paper in which you:

1. Assess how globalization and technology changes have impacted the corporation you researched.
2. Apply the industrial organization model and the resource-based model to determine how your corporation could earn above-average returns.
3. Assess how the vision statement and mission statement of the corporation influence its overall success. 
4. Evaluate how each category of stakeholder impacts the overall success of this corporation. 
5. Use at least two (2) quality references. Note: Wikipedia and other Websites do not quality as academic resources.

Week Three Assignment

 

  Please complete the following 5 exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculations within Excel cells is acceptable). Save the document, and submit it in the appropriate week using the Assignment Submission button.

 

1. Overhead application: Working backward

The Towson Manufacturing Corporation applies overhead on the basis of machine hours. The following divisional information is presented for your review:

	Division     A	Division B
Actual machine hours	26,500	?
Estimated machine hours	20,000	?
Overhead application rate	$5.00	$6.00
Actual overhead	$120,000	?
Estimated overhead	?	$90,000
Applied overhead	?	$87,000
Over- (under-) applied overhead	?	$8,500

Find the unknowns for each of the divisions.

 

2. Computations using a job order system

Spencer Corporation employs a job order cost system. On May 1 the following balances were extracted from the general ledger;

 

Work in process           $ 36,200

Finished goods                         86,900

Cost of goods sold       130,700

 

Work in Process consisted of two jobs, no. 101 ($22,400) and no. 103 ($13,800). During May, direct materials requisitioned from the storeroom amounted to $96,500, and direct labor incurred totaled $116,500. These figures are subdivided as follows:

Direct Materials   Direct Labor Job No.   Amount   Job No.   Amount 101   $6,000   101   $7,800 117   18,500   103   20,800 116   34,200   117   44,000 Other   36,800   116   18,000     $95,500   Other   25,900             $116,500

Job no. 117 was the only job in process at the end of the month. Job no. 101 and three “other” jobs were sold during May at a profit of 20% of cost. The “other” jobs contained material and labor charges of $23,000 and $17,400, respectively.

 

General applies overhead daily at the rate of 150% of direct labor cost as labor summaries are posted to job orders. The firm’s fiscal year ends on May 31.

Instructions:

a.       Compute the total overhead applied to production during May.

b.      Compute the cost of the ending work in process inventory.

c.       Compute the cost of jobs completed during May.

d.      Compute the cost of goods sold for the year ended May 31.

 

 

3. High-low method
The following cost data pertain to 20X8 operations of Houston Products:

	Quarter 1	Quarter 2	Quarter 3	Quarter 4
Shipping costs	$56,200	$58,620	$61,000	$59,400
Orders shipped	120	135	170	145

 

The company uses the high-low method to analyze costs.

a.       Determine the variable cost per order shipped.

b.      Determine the fixed shipping costs per quarter.

c.       If present cost behavior patterns continue, determine total shipping costs for 20X9 if activity amounts to 570 orders.

 

 

 

4. Break-even and other CVP relationships

Pine Hospital has average revenue of $190 per patient day. Variable costs are $50 per patient day; fixed costs total $4,620,000 per year.

a.       How many patient days does the hospital need to break even?

b.      What level of revenue is needed to earn a target income of $560,000?

c.       If variable costs drop to $36 per patient day, what increase in fixed costs can be tolerated without changing the break-even point as determined in part (a)?

 

 

 

5. Direct and absorption costing

The information that follows pertains to XYZ Products for the year ended December 31, 20X8.

Inventory, 1/1/X8	26,000 units
Units manufactured	80,000
Units sold	83,000
Inventory, 12/31/X8	? units
Manufacturing costs:
Direct materials	$4 per unit
Direct labor	$5 per unit
Variable factory overhead	$9 per unit
Fixed factory overhead	$300,000
Selling & administrative expenses:
Variable	$2 per unit
Fixed	$136,000

 

The unit selling price is $26. Assume that costs have been stable in recent years.

 

Instructions:

a.       Compute the number of units in the ending inventory.

b.      Calculate the cost of a unit assuming use of:

1.      Direct costing.

2.      Absorption costing.

c.       Prepare an income statement for the year ended December 31, 20X8, by using direct costing.

d.      Prepare an income statement for the year ended December 31, 20X8, by using absorption costing.

No Plagiarism

Here is the background information: A consumer spends her income on nuts (n) and fruits (f) both of which are measured in units in pounds. THe total utility is shown below: #of units consumed TU(n) TU(f) 0 0 0 1 64 32 2 96 48 3 112 56 she has a budget of $12 and P(n)= $2, and P(f) = $1 Question: Would Q(n) = 5 and Q(f = 2 be utility maximizing? Explain not in reference to TU but MU or marginal utility I said yes, because the marginal utility for both n and f is the same (I used the marginal utility rule), but I don’t know if that is correct, help?