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Jenco Incorporated's only product is a combination fertilizer-weed killer called Fertikil. Fertikil is sold nationwide through normal marketing channels to retail nurseries and garden stores.Taylor Nursery plans to sell a similar fertilizer weed killer compound through its regional nursery chain under its own private label. Taylor does not have manufacturing facilities of its own, so it has asked Jenco (and several other companies) to submit a bid for manufacturing and delivering a 25,000 pound order of the private brand compound to Taylor. While the chemical composition of the Taylor compound differs from that of Fertikil, the manufacturing processes are very similar.The Taylor compound would be produced in 1.000 pound lots. Each lot would require 30 direct labor-hours and the following chemicals:Chemicals Quantity in PoundsCW-3 400JX-6 300MZ-8 200BE-7 100The first three chemicals (CW-3, JX-6, and MZ-8) are all used in the production of Fertikil. BE-7 was used in another compound that Jenco discontinued several months ago. The supply of BE-7 that Jenco had on hand when the other compound was discontinued was not discarded. Jenco could sell its supply of BE-7 at the prevailing market price less $0.10 per pound selling and handling expenses.Jenco also has on hand a chemical called CN-5, which was manufactured for use in another product that is no longer produced. CN-5, which cannot be used in Fertikil, can be substituted for CW-3 on a one-for-one basis without affecting the quality of the Tavlor compound. The CN-5 in inventory has a salvage value of $500.Inventory and cost data for the chemicals that can be used to produce the Taylor compound are as shown below:Row Material Pounds in Inventory Actual Price/Pound Current Market When Purchased Price/PoundCW-3 22,000 $0.80 $0.90JX-6 5,000 0.55 0.60MZ-8 8,000 1.40 1.60BE-7 4,000 0.60 0.65CN-5 5,500 0.75 (Salvage)The current direct labor rate is $14 per hour. The predetermined overhead rate is based on direct labor-hours (DLH). The predetermined overhead rate for the current year, based on a two-shift capacity of 400,000 total DLH with no overtime, is as follows:Variable manufacturing overhead $ 4.50 per DLHFixed manufacturing overhead 7.50 per DLHCombined rate $12.00 per DLHJenco's production manager reports that the present equipment and facilities are adequate to manufacture the Taylor compound. Therefore, the order would have no effect on total fixed manufacturing overhead costs. However, Jenco is within 400 hours of its two-shift capacity this month. Any additional hours beyond 400 hours must be done in overtime. If need be, the Taylor compound could be produced on regular time by shifting a portion of Fertikil production to overtime. Jenco's rate for overtime hours is 1.5 times the regular pay rate, or $21 per hour. There is no allowance for any overtime premium in the predetermined overhead rate.Required:1. Jenco, has decided to submit a bid for a 25,000 pound order of Taylor Nursery's new compound. The order must be delivered by the end of the current month. Taylor Nursery has indicated that this is a one-time order that will not be repeated. Calculate the lowest price that Jenco could bid for the order without reducing its net operating income.
The bonds are convertible into 30 shars of Haas $5 par value common stock for each $1,000 worth of bonds. On 12/31/08, after the bond interest has been paid, $20,000 face value bonds were converted. The market value of Haas common stock was $44 pe..
Ingram Co. manufactures office furniture. During the most productive month of the year, 3,500 desks were manufactured at a total cost of $84,400. In its slowest month, the company made 1,100 desks at a cost of $46,000.
Submit a tax file memorandum with proper citations of all sources: I want to see citations of the court case, a revenue procedure, and a specific section of the IRC.
Ridge Point Company's budgeted sales were 22,500 units at $76 per unit. Actual sales were 21,750 units at $79 per unit. What was Oaks Edge sales price variance?
Indicate the effect of each of these errors on working capital, current ratio (assume that the current ratio is greater than 1), retained earnings, and net income for the current year and the subsequent year.
One defect of the IRR method is that it assumes that the cash flows to be received from a project can be reinvested at the IRR itself, and that assumption is often not valid. Why do you think this is a correct statement?
Which would be a non-fraudulent earnings management scheme?
What factors are likely to drive an organization's outlays for new capital(such as plant, property and equipment) and for working captial( such as receivables and inventory)? what ratios would you use to help generate forecasts of these outlays?
Why do intercompany balances exist within the financial records of the separate companies? How are these reciprocals eliminated on a consolidation worksheet?
Northwest paid freight charges of $7,500. Merchandise with an invoice amount of $5,000 was returned for credit. Cost of goods sold for the year was $380,000. What is ending inventory assuming Northwest uses the gross method to record purchases?
Global, Inc., owns a delivery truck which initially cost $30,000. After depreciation of $15,000 had been deducted, the truck was traded-in on a new truck that cost $60,000. Global was required to pay the car dealer $20,000 in cash. What is Global'..
A controlling influence over the a company you have invested in is based on you owning voting stock exceeding what percent?
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