Jessica massey a friend of smiths and an owner of a small

Reference no: EM13607182

For the following scenarios, use the cost information pertaining to the current production process. The Special Order
Jessica Massey, a friend of Smith's and an owner of a small company in nearby Tacoma, WA, had just called to see if TPE could accommodate a special printing order next month. She needed 20,000 brochures, concerning a new product, to distribute at three trade shows she was planning to attend. When Smith quoted Massey the usual price of $18 per 100 brochures ($0.18/brochure), she sighed, "Ross, I know that TPE does a high quality job, but I'm short on funds right now because I have spent so much on getting this new product up and running. I can't go any higher than $10 per 100 brochures ($0.10/brochure) on this job. If you can't do it for that, I'll have to go to someone else. I'm sure the brochures won't look as nice, but that's all I've got to spend."

Smith knew he did not have the capacity at the moment to handle the special order. He had a maximum capacity of 160,000 and was operating at 150,000 currently, so he couldn't accommodate an additional 20,000 brochures. And $10 per 100 brochures sounded low. He replied, "Let me look into this. I'm not sure we can do it for $10, but I'll be glad to think about it. I'll give you a call back in a couple of days." Smith realized that with this order he would not have to pay his sales representative the typical sales commission of $1 per 100 brochures ($0.01/brochure), but that $1 per 100 savings would not begin to make up for the lower price.Should Smith accept the special order? Provide both financial and non-financial considerations.

Reference no: EM13607182

Questions Cloud

A day later jim edwards the owner of easy printing a local : the outsourcing opportunitya day later jim edwards the owner of easy printing a local one-room printing operation in

Froment corporation uses the weighted-average method in its : froment corporation uses the weighted-average method in its process costing system. this month the beginning inventory

1 why are z scores most often written with two decimal : 1. why are z scores most often written with two decimal places?2. what is the z score for a x value one standard

Calculate the average walking speed in normal times in : part a sand dunes in a desert move over time as sand is swept up the windward side to settle in the lee side. such as

Jessica massey a friend of smiths and an owner of a small : for the following scenarios use the cost information pertaining to the current production process. the special

How many gallons of brine must the plant take in per day : multi-stage flash distillation is used to desalinate seawater so it is fit for human consumption. a flash distillation

Presented below is financial information for two different : presented below is financial information for two different companies. instructions a determine the missing amounts.

Compute the percentage of the normal curve located at or : 1. compute the percentage of the normal curve located at or above each of the following z values.a. 1.50b. -1.50c.

A jogger runs in a straight line with an average velocity : a jogger runs in a straight line with an average velocity of 5.1ms for 2.1 min and then with an average velocity of 4.9

User Account

All Pages