1984 Love and Freedom Can Be Crushed - 860 Words

Sigmund Freud once wrote, â€Å"Unexpressed emotions will never die. They are buried alive and will come forth later in uglier ways.† This can be seen in Georg Orwell’s 1984, which depicts an all-poweul totalitarian society where the government, knowen as the Party or Big Brother, has complete control over the people. Our protagonist, Winston, despises the Party, and secretly rebels by writing his seditious thoughts in a secret diary. To rebel, he starts a covert affair with Julie, another person that also despises the party, and joins the Brotherhood, secret organization devoted to overthrowing the Party, but is later captured by the Party. At first he resists but when faced with torture, Winston immediately betrays his lover, Julia. He†¦show more content†¦Here Orwell again uses a metaphor to emphasize the violence and hardship of obtaining love in Winston’s world. This emphasis implies that love is hard to obtain, especially in Oceania, where it is f orbidden. Therefore the passage reveals that to love some requires as setting where love is encouraged, and not repressed. After love is obtained, it can only survive if it has freedom. In the middle of the novel, Orwell depicts Winston and Julia making love in an old hotel room. He writes: Dirty or clean the room was paradise. As soon as they arrived they would sprinkle everything with pepper bought on the black market tear, off their clothes and make love with sweating bodies, then fall asleep and wake to find that the bugs rallied and were massing for the counter attack (150). Here Orwell uses metaphor to emphasize how unoppressed Winston felt despite his constricted surroundings. Making love with Julia was a sign of rebellion against the party and demonstrating his freedom, making him feel joyful. This emphasis implies that his happiness came from the freedom he felt while making love. Therefore, this reveals to us that you have to be free or feel free to be in love, and can not be restricted or bound by rules. Although love and freedom both require each other, they can not coexist in a totalitarian government that has intolerance for independence and rules. Toward the middle of the novel, Orwell depicts WinstonShow MoreRelatedBig Brother Is Watching You1106 Words   |  5 Pages AP US Government Mrs. Bradshaw 25 August 2014 Big Brother is Watching You 1984 is a novel that takes place in a Totalitarian dystopia named Oceania. The story follows a member of this futuristic society named Winston Smith, who is strongly opposed to the omniscient and oppressive â€Å"Big Brother† who runs the country. Winston works for the government in a division called the Ministry of Truth. He is responsible for altering history in the government’s favor. The government attempts to control theRead MoreEssay On Totalitarianism 19841300 Words   |  6 PagesAchieving Totalitarianism in 1984 Before the concept of government existed mankind still attempted to gain dominance over one another. Once the concept was developed governments remained consistent in their attempts to gain control of their people and world domination. Adolf Hitler and other dictators were prime examples of totalitarianism â€Å"attempting to control every aspect of its subjects, viewing any sign of independence as treasonous centralized party† ( Quinn 1). Along came â€Å"historical catastrophesRead MoreThe Real-Life Counterparts of 1984s Oceania Essay1616 Words   |  7 Pages Adolf Hitler and Joseph Stalin are household names, but what about the more obscure individuals Muammar Qaddafi, Xi Jinping, and Kim Jong-un? George Orwell used 1984 as a prediction of what could happen if the fascism in Nazi Germany and Soviet Russia persisted. The dystopian, fascist government that exists in 1984 resembles the governments in the real-life, modern-day countries of Libya, China, and North Korea. The government in Orwell’s Oceania is fascist, causing citizens like Winston andRead MoreGeneral Commentary of 1984 by George Orwell1514 Words   |  7 PagesGeneral Commentary of 1984 by George Orwell George Orwells dystopian (a fictional place where people lead dehumanized and fearful lives) vision of the year 1984, as depicted in what many consider to be his greatest novel, has entered the collective consciousness of the English-speaking world more completely than perhaps any other political text, whether fiction or nonfiction. No matter how far our contemporary world may seem from 1984s Oceania, any suggestion of government surveillanceRead MorePleasantville961 Words   |  4 Pagesportray individuals who challenge the established values of their time. It is impossible for the individual who values freedom to be exultant in a society that is underpinned by rigid conformity. In the Novel â€Å"Nineteen Eighty Four† by George Orwell, a totalitarian future society is portrayed, through a man whose daily work is rewriting history and tries to rebel by falling in love. Whereas The film â€Å"Pleasantville† directed by Gary Ross, Two teenagers find themselves in a 1950’s sitcom where theirRead More1984 - Character Development Requires a Conflict Essay2281 Words   |  10 Pages1984 Essay – by Len Farag In â€Å"1984† by George Orwell, the main character, Winston is in conflict in nearly every page of the book. He is in constant surveillance by the Party. He has also, as the text describes, had problems with his relationship with Katherine, in the past. With the rule of the Party, comes the constant control of the omnipresent, Big Brother. He controls everything, from living conditions to how much chocolate is allowed to be given to any member of Oceania. There is also theRead MoreEssay on Democracy Versus Totalitarianism in George Orwells 19842085 Words   |  9 PagesDemocracy Versus Totalitarianism in George Orwells 1984 Winston Smith lived in a world of lies, chaos, and disorder. His uniform was shabby and living space cold and dirty. Changing the past to suit the present was his job where he worked, the Ministry of Truth. One day, he encountered a beautiful young woman of about 26 years of age and instantly fell in love. Little did he know that she would be the one who would end his life. He dreams of sleeping with her but fears that he would be capturedRead MoreEssay on Analysis of George Orwells 19844218 Words   |  17 PagesOrwells 1984 War Is Peace. Freedom Is Slavery. Ignorance Is Strength. The party slogan of Ingsoc illustrates the sense of contradiction which characterizes the novel 1984. That the book was taken by many as a condemnation of socialism would have troubled Orwell greatly, had he lived to see the aftermath of his work. 1984 was a warning against totalitarianism and state sponsored brutality driven by excess technology. Socialist idealism in 1984 had turned to a total loss of individual freedom in exchangeRead MoreAlienation in 19841861 Words   |  8 PagesAlienation In 1984 In the novel 1984 by George Orwell there are many causes which lead to Winston Smith’s alienation. Winston lives in the dystopian society known as Oceania, which is controlled by the â€Å"Party† and a dictator named â€Å"Big Brother.† â€Å"Big Brother† watches over and controls the thoughts and actions of the citizens in Oceania. Winston feels oppressed by the control of the â€Å"Party†. The actions of the â€Å"Party† affect Winston and lead him to feel alienated. To alienate is to makeRead MoreChapter One : Down With Big Brother3355 Words   |  14 PagesHannah Gates Mrs. Carlson Pre AP English II 3 August 2015 Assignment 1 1984 Book One, Chapter One: Down With Big Brother Summary: We are introduced to the world in which Winston Smith lives, Winston shows his discontent towards Big Brother through his illegal diary, and he realizes he might not be alone in his rebellion towards Big Brother. 1984 Book One, Chapter Two: Thoughtcrime IS Death Summary: Winston helps his neighbor, Parsons, whose children accuse him of being a thoughtcriminal and

The Theology Of Thomas Aquinas - 1157 Words

Thomas Aquinas was a one of the few philosophers to interpret the theology as a whole distinguishing the difference between theology and philosophy by explaining Law in general in a detailed account and focusing on kinds of law which he classified as Eternal, Human, Divine and Natural law. Aquinas suggests in order for law to be understood some reasoning has to be provided which is why as a philosopher what he explained could not provoke Christian beliefs, but establish a relationship between theory and religion. As a philosopher he understands and describes law as being influenced by certain actions that man chooses to act upon or refrain from, which is entirely up to us or as he may put it, an ordered rule. Because of this assumption†¦show more content†¦For these laws to be effective and understood he explains the essence of law breaking it down into three important aspects; Reason a superior order, Common Good some sort of satisfaction through law (not suggesting he doesn t care) and One who has care in the sense that in the community trust is put into the hands of someone of higher authority who has common good as their main objective. Eternal Law is considered a law by Aquinas in the sense that since God being the creator of the universe, every command will be passed as God understands it and will stand in its eternal form becoming eternal law. Thomas has portrayed art of eternal law being community ruled through divine reasoning provided by God meaning his reasoning must have a proper and perfect order making it eternal. Since Thomas has used an organizational structure as I explained previously, Divine Law being based on revelation and extracted from Eternal Law, we learn how the bible has worked in correspondence with Divine law mainly because of how it is split into Old and New Law similar to the Old Testament and New Testament in the bible. To my understanding Aquinas bases his facts about the Old law on the Ten Commandments with an assumption that humans are driven by the fear and the rewards expected to be benefited from obeying the Law whereas the New

Healthcare management Obtain Medicaid and Government Payments

Questions: 1. Since JCAHO accreditation is voluntary, why do many hospitals pursue it?.2. What advantages / disadvantages might there be for hospitals that choose not to pursue JCAHO accreditation?. Answer: 1. JCAHO accreditation Every hospital must achieve this certification to obtain Medicaid and any government payments as it would be difficult to serve without getting government aid. These certifications help in quick sanction of insurances. Advantages- A hospital receiving this accreditation is indicative of a quality organization and holding high standards. This certification informs that the pharmacy, nursing services, nurses and the laboratory work are competent and reflects their proficiency in tasks and honesty of organization. JCAHO approved hospitals strive hard to maintain first rate working conditions and have the best staff. Disadvantages- Hospitals who do not continue such work are bound to lose accreditation or when it is found to hold dangerous equipment that is a threat to the public health. It ultimately decreases the confidence of the clients (Jost, 1982). 2. A survey was conducted by the author on (St. Anthony Medical center, 1201 South MaIndiana Street Crown PoIndianat, Indiana 46307-8483) and upon interrogating the supervisor, administrators, doctors of the hospital the following information was given- They were always inspection ready, maintained loyalty; equipment was safe and monitored on regular basis They maintained a patient-centered approach and never compromised with quality They recruited highly qualified healthcare professional from different parts of world It failed to achieve the approval twice, but it was successful the third time as it maintained strict compliance with rules. Initially, there was free trial version They organized low cost educational seminars for the public and fundraising drives It got plus points for every measure on quality report ("Franciscan St. Anthony Health in Crown Point, IN | US News Best Hospitals", 2016) References Franciscan St. Anthony Health in Crown Point, IN | US News Best Hospitals. (2016). Health.usnews.com. Retrieved 22 May 2016, from https://health.usnews.com/best-hospitals/area/in/franciscan-st-anthony-health-6420225 Jost, T. S. (1982). Joint Commission on Accreditation of Hospitals: Private Regulation of Health Care and the Public Interest, The.BCL Rev.,24, 835.

Social Media in Enhancing Social Relationships and Happiness

Introduction A defining characteristic of the 21st century has been the invention of many novel technologies which have changed the way in which human beings operate.Advertising We will write a custom essay sample on Social Media in Enhancing Social Relationships and Happiness specifically for you for only $16.05 $11/page Learn More One aspects of human life which has been profoundly impacted by technological advancement is communication. Communication has been transformed by technology and by social networking tools which have become very popular attracting millions of users all over the world. Arguments have been advanced that social media and technology have a negative impact on relationships since they decrease intimacy. This paper will argue that social media and technology play a crucial role in enhancing social relationships and happiness. The paper will demonstrate that social media helps people to maintain their primary relationships and hence h as a positive impact on happiness. Technology Enhancing Relationships Technology and social media have assisted people to communicate more efficiently and frequently than was possible in the past. This is a good attribute since Communication is the cornerstone on which all successful relationships are built. Social media and technology assist to foster and maintain relationships where the people live in different geographical regions. Through these tools, people from different countries are able to interact and socialize with relative ease. Mukherjee reveals that technology such as the phone enables her to stay in touch with her sister who lives far away. This contact is very important since it enables them to enhance their deep relationship (413). Without technology and social media, communication between people who live far away would be rare. It would therefore be harder to foster intimacy and the relationships would therefore suffer. Social media and technology enables people to communicate better by helping them overcome setbacks that are inherent in traditional means of communication. Research indicates that the anonymity which is afforded by online communication gives confidence to people with low self-confidence in real life (Griffiths and Hussain 564). As such, people who are unlikely to create relationships in the real world can do that through social media tools. Wright suggests that the distance associated with online communication creates a feeling of safety that enables people to make connections that they would not on a face-to-face scenario (433). Social media assists individuals to experiment with positive communication styles such as assertiveness.Advertising Looking for essay on social sciences? Let's see if we can help you! Get your first paper with 15% OFF Learn More Social media may result in the enhancement of social lives by giving people who would never have met an opportunity to do so. While it is true that friendships i n social networks may appear shallow, the tools enable people to socialize and keep in touch with friends whom they would really interact with in real life. People are therefore given the opportunity to maintain friendships which would otherwise wither away without these tools. Social media also enables people to widen their circles of friends since it is easy to meet and befriend new people online. In the online environment, relationships can be strong since they are based on interests and personal attributes rather than physical attributes or even social standings (Albrechtslund 25). These relationships can then grow to become strong primary relationships. Negative Impacts on Relationships Social media assists in the forging of social bonds. Even so, the bonds forged online are not as strong as those made through face-to-face contact. Wright reveals that the internet results in people declaring friendships on the basis of very flimsy connections (433). This is true since sites lik e Facebook enable people to be friends with people whom they do not communicate with or even share any interests with. In addition to this, social media results in the creation of many shallow relationships as opposed to having a few meaningful relationships in the real world. The intimacy that is present in the primary relationships is therefore lost because of social media. There is a major concern that social media and technology poses a threat to the traditional fabric of effective communication. This threat is manifest in a number of ways. To begin with, social media reduces the time that would be spent on face-to-face communication. Wright asserts that the more time people spend engaged in their online relationship the less time they spend in their real relationships (433). The real relationships therefore suffer as people use time and effort on the many online relationships which are mostly shallow. Another way in which social media negatively affects traditional communicatio n is because online communication makes excessive usage of shorthand and informal speech patterns. Wright states that such a trend may affect how we relate to each other in the offline world with negative effects (433). Conclusion Social networking tools have gained great relevance in contemporary society, and are today an integral part of communication for many people. Without social media and technology, interactions between people would be limited and this would result in less happiness.Advertising We will write a custom essay sample on Social Media in Enhancing Social Relationships and Happiness specifically for you for only $16.05 $11/page Learn More From the arguments presented in this paper, it is clear that technology has had a great impact on human communication. From this paper, it can be authoritatively stated that social media and technology have had a positive impact on communication and by extension the relationships between individuals. W orks Cited Albrechtslund, Anders. â€Å"Online social networking as participatory surveillance†. First Monday, 13.3 (2008): 23-27. Griffiths, Mark and Hussain Zaheer. â€Å"Use of Massively Multi-Player Online Role-Playing Games: A Pilot Study†. Int J Ment Health Addiction 7.5 (2009): 563–571. Mukherjee, Bharati. â€Å"Two ways to belong in America.† Patterns for college writing. Ed. Kirzner, Laurie and Mandell Stephhen. Boston: Bedford/St. Marin Press, 2001. Print. Wright, Alex. â€Å"Friending, Ancient or Otherwise.† Patterns for college writing. Ed. Kirzner, Laurie and Mandell Stephhen. Boston: Bedford/St. Marin Press, 2001. Print. This essay on Social Media in Enhancing Social Relationships and Happiness was written and submitted by user Shiva to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Time To Kill Essays - A Time To Kill, Films, Rape, Free Essays

Time To Kill Essays - A Time To Kill, Films, Rape, Free Essays Time to Kill Racism and Justice collide when the life of a ten-year-old black girl, Tonya Hailey, is shattered by two drunken and remorseless young white men , as they brutally beat and rape her. In John Grisham?s novel rape, racism, and justice all prevail throughout the story A Time to Kill. Carl Lee Hailey, the father of the ten-year-old child takes justice into his own hands by murdering his daughters assailants. As his young defense attorney struggles with the law to save his clients life, racism spreads through the streets of Canton. ?She watched as he walked around the tree on her right side, and she stared at him as he stared between her legs. When he lowered his pants she turned to the left and closed her eyes. He was hurting her again.? The two men that had raped the black child, Tonya Hailey, had no respect for the black folks. When they selected their victim they did not care if she was a child, but yet the fact that she was black gave them more reason to take away her rights as a human. This is evident throughout the rape when one of the assailants, Cobb explained; ?...that she was not dead because niggers generally could not be killed by kicking and beating and raping. It took much more, something like a knife or a rope to dispose of a nigger.? (pg.2) After the two intoxicated and remorseless men were done with her, the mostly white town found out about this most inhuman crime. They reacted with shock and horror. ?We picked them up last night for rape.? ?Who?d they rape ?That nigger Hailey his daughter.? ?You?re kidding! (pg.23) The people of the town could not believe that two of their white people could rape a young child. Not only the fact that she was black, but a ten-year-old child. Later on chaos erupted in the town of Mississippi after the father of the raped girl, Carl Lee Hailey took justice into his own outraged hands and murdered her two assailants. Racial tension in the town was already apparent, and excelled to more violent action against the black community after the murders. The people of the town that were white took several actions in trying to interfere with justice. Their first mission was to try and eliminate Carl Lee Hailey?s attorney, Jake Brigance. The reason for their hatred towards him was because he was defending a black man in a racial community. As the trial grew deeper, a number of white towns people joined a group who despised blacks , known as the Kl Klux Klan (KKK). Joining together like this, gave them more power to continue their fight against the blacks and the people involved in the case. For ten days, with burning crosses and the crack of sniper fire spreading through the streets of Clanton, the nation sat spellboun! d as a young defense attorney, Jake Brigance struggles to save his clients life and then his own. ?Hello,? answered Prattle. ?Who?s this asked the voice. ?Deputy Joe Pintle. Who?s this ?Where?s the sheriff ?Asleep, I reckon.? ?Okay listen, and listen real good because this is important and I Ain?t calling? again. You know that Hailey nigger ?Yeah.? ?You know his lawyer, Brigance ?Yeah.? ?Then listen. Sometime between now and three A.M., they?re gonna blow up his house.? (pg.272) As the trial progresses Jake found the only way to save his clients life would be a plead for insanity. His argument would be that Carl Lee Hailey was not in the right frame of mind, he was so hurt and outraged by the rape of his daughter he felt it was the only way to end her pain and his anger. To prove this, Jake?s main witness was a psychiatrist who had the highest credentials in the state of Mississippi. Until the prosecutor, Mr. Buckley, discredited the psychiatrist. ?Dr. Bass, have you ever been convicted of a felony ?Of course not!? Bass answered loudly, desperately. ?Are you certain Buckley thundered. ?Of course I?m certain,? Bass protested. ?You?re certain Buckley asked. ?Yes,? Bass answered through clenched teeth. ?You?re telling this jury that on October 17, 1956, in Dallas, Texas, you were not convicted of a felony under the name of Tyler Bass. No answer. ?You?re telling this jury that on October 17, 1956 you were

Relevant Cost for Decision Making Chapter 13 Essays

Relevant Cost for Decision Making Chapter 13 Essays Relevant Cost for Decision Making Chapter 13 Paper Relevant Cost for Decision Making Chapter 13 Paper Chapter 13 Relevant Costs for Decision Making Solutions to Questions 13-1A relevant cost is a cost that differs in total between the alternatives in a decision. 13-2An incremental cost (or benefit) is the change in cost (or benefit) that will result from some proposed action. An opportunity cost is the benefit that is lost or sacrificed when rejecting some course of action. A sunk cost is a cost that has already been incurred and that cannot be changed by any future decision. 13-3No. Variable costs are relevant costs only if they differ in total between the alternatives under consideration. 3-4No. Not all fixed costs are sunk- only those for which the cost has already been irrevocably incurred. A variable cost can be a sunk cost, if it has already been incurred. 13-5No. A variable cost is a cost that varies in total amount in direct proportion to changes in the level of activity. A differential cost is the difference in cost between two alternatives. If the level of activity is the s ame for the two alternatives, a variable cost will not be affected and it will be irrelevant. 13-6No. Only those future costs that differ between the alternatives under consideration are relevant. 3-7Only those costs that would be avoided as a result of dropping the product line are relevant in the decision. Costs that will not differ regardless of whether the product line is retained or discontinued are irrelevant. 13-8Not necessarily. An apparent loss may be the result of allocated common costs or of sunk costs that cannot be avoided if the product line is dropped. A product line should be discontinued only if the contribution margin that will be lost as a result of dropping the line is less than the fixed costs that would be avoided. Even in that situation the product line may be retained if its presence promotes the sale of other products. 13-9Allocations of common fixed costs can make a product line (or other segment) appear to be unprofitable, whereas in fact it may be profitable. 13-10If a company decides to make a part internally rather than to buy it from an outside supplier, then a portion of the company’s facilities have to be used to make the part. The company’s opportunity cost is measured by the benefits that could be derived from the best alternative use of the facilities. 3-11Any resource that is required to make products and get them into the hands of customers could be a constraint. Some examples are machine time, direct labor time, floor space, raw materials, investment capital, supervisory time, and storage space. While not covered in the text, constraints can also be intangible and often take the form of a formal or informal policy that prevents the organization from furthering its goals. 13-12Assuming that fixed costs are not affected, profits are maximized when the total contribution margin is maximized. A company can maximize its contribution margin by focusing on the products with the greatest amount of contribution margin per unit of the constrained resource. 13-13Joint products are two or more products that are produced from a common input. Joint costs are the costs that are incurred up to the split-off point. The split-off point is the point in the manufacturing process where joint products can be recognized as individual products. 13-14Joint costs should not be allocated among joint products. If joint costs are allocated among the joint products, then managers may think they are avoidable costs of the end products. However, the joint costs will continue to be incurred as long as the process is run regardless of what is done with one of the end products. Thus, when making decisions about the end products, the joint costs are not avoidable and are irrelevant. 13-15As long as the incremental revenue from further processing exceeds the incremental costs of further processing, the product should be processed further. 3-16Most costs of a flight are either sunk costs, or costs that do not depend on the number of passengers on the flight. Depreciation of the aircraft, salaries of personnel on the ground and in the air, and fuel costs, for example, are the same whether the flight is full or almost empty. Therefore, adding more passengers at reduced fares at certain times of the week when seats would otherwise be empty does little to increase the total costs of making the flight, b ut can do much to increase the total contribution and total profit. Exercise 13-1 (15 minutes) | |Case 1 | |Case 2 | | |Item |Relevant |Not Relevant | |Relevant |Not Relevant | |a. |Sales revenue |X | | | |X | |b. |Direct materials |X | | |X | | |c. Direct labor |X | | | |X | |d. |Variable manufacturing overhead |X | | | |X | |e. |Depreciation- Model B100 machine | |X | | |X | |f. |Book value- Model B100 machine | |X | | |X | |g. Disposal value- Model B100 machine | |X | |X | | |h. |Market value- Model B300 machine (cost) |X | | |X | | |i. |Fixed manufacturing overhead | |X | | |X | |j. |Variable selling expense |X | | | |X | |k. Fixed selling expense |X | | | |X | |l. |General administrative overhead |X | | | |X | Exercise 13-2 (30 minutes) 1. No, production and sale of the racing bikes should not be discontinued. If the racing bikes were discontinued, then the net operating income for the company as a whole would decrease by $11,000 each quarter: Lost contribution margin | |$(2 7,000) | |Fixed costs that can be avoided: | | | |Advertising, traceable |$ 6,000 | | |Salary of the product line manager |  10,000 |  Ã‚  Ã‚  16,000 | |Decrease in net operating income for the company as a whole | |$(11,000) | The depreciation of the special equipment is a sunk cost and is not relevant to the decision. The common costs are allocated and will continue regardless of whether or not the racing bikes are discontinued; thus, they are not relevant to the decision. Alternative Solution: |Current Total |Total If Racing Bikes|Difference: Net | | | |Are Dropped |Operating Income | | | | |Increase or (Decrease) | |Sales |$300,000 |$240,000 |$(60,000) | |Less variable expenses |  120,000 |  Ã‚  Ã‚  87,000 |  Ã‚  33,000 | |Contribution margin |  180,000 |  153,000 |  (27,000) | |Less fixed expenses: | | | | |Advertising, traceable |30,000 |24,000 |6,000 | |Depreciation on special |23,000 |23,000 |0 | |equipment* | | | | |Salaries of product managers |35,000 |25,000 |10,000 | |Common allocated costs |  Ã‚  Ã‚  60,000 |  Ã‚  60,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 | |Total fixed expenses |  148,000 |  132,000 |  Ã‚  Ã‚  16,000 | |Net operating income |$  32,000 |$  21,000 |$ (11,000) | *Includes pro-rated loss on the special equipment if it is disposed of. Exercise 13-2 (continued) 2. The segmented report can be improved by eliminating the allocation of the common fixed expenses. Following the format introduced in Chapter 12 for a segmented income statement, a better report would be: | | |Total |Dirt Bikes |Mountain Bikes |Racing Bikes | | |Sales $300,000 |$90,000 |$150,000 |$60,000 | | |Less variable manufacturing and selling expenses |  120,000 |  27,000 |  Ã‚  Ã‚  60,000 |  Ã‚  33,000 | | |Contribution margin |  180,000 |  63,000 |  Ã‚  Ã‚  90,000 |  Ã‚  27,000 | | |Less traceable fixed expenses: | | | | | | |Advertising |30,000 |10,000 |14,000 |6,000 | | |Depreciation of special equipment |23,000 |6,000 |9,000 |8,000 | | |Salaries of the product line managers |  Ã‚  Ã‚  35,000 |  12,000 |  Ã‚  Ã‚  13,000 |  Ã‚  10,000 | | |Total traceable fixed |  Ã‚  Ã‚  88,000 |  28,000 |  Ã‚  Ã‚  36,000 |  Ã‚  24, 000 | | |expenses | | | | | | |Product line segment margin |92,000 |$35,000 |$ 54,000 |$? 3,000 | | |Less common fixed expenses |  Ã‚  Ã‚  60,000 | | | | | |Net operating income |$? 32,000 | | | | Exercise 13-3 (30 minutes) | 1. |Per Unit Differential | |15,000 units | | | |Costs | | | | | |Make |Buy | |Make |Buy | | |Cost of purchasing | |$35 | | |$525,000 | | |Direct materials |$14 | | |$210,000 | | | |Direct labor |10 | | |150,000 | | | Variable manufacturing overhead |3 | | |45,000 | | | |Fixed manufacturing overhead, traceable1 |2 | | |30,000 | | | |Fixed manufacturing overhead, common |  Ã‚  Ã‚  Ã‚  Ã‚   |  Ã‚  Ã‚  Ã‚  Ã‚   | |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | | |Total costs |$29 |$35 | |$435,000 |$525,000 | | |Difference in favor of continuing to make the carburetors | |$6 | | | |$90,000 | | |1 |Only the supervisory salaries can be avoided if the carburetors are purchased. The remaining book value of the special | | |equipment is a sunk cost; hence, the $4 per unit depreciation expense is not relevant to this decision. Based on these data, | | |the company should reject the offer and should continue to produce the carburetors internally. | | 2. |Make |Buy | | |Cost of purchasing (part 1) | |$525,000 | | |Cost of making (part 1) |$435,000 | | | |Opportunity cost- segment margin foregone on a potential new product line |  150,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | | |Total cost |$585,000 |$525,000 | | |Difference in favor of purchasing from the outside supplier | |$60,000 | | Thus, the company should accept the offer and purchase the carburetors from the outside supplier. Exercise 13-4 (15 minutes) Only the incremental costs and benefits are relevant. In particular, only the variable manufacturing overhead and the cost of the special tool are relevant overhead costs in this situation. The other manufacturing overhead costs are fixed and are not affected by the decision. | |Per Unit |Total | | | |for 20 | | | |Bracelets | |Incremental revenue |$169. 95 |$3,399. 0 | |Incremental costs: | | | |Variable costs: | | | |Direct materials |$  84. 00 |1,680. 00 | |Direct labor |45. 00 |900. 00 | |Variable manufacturing overhead |4. 00 |80. 00 | |Special filigree | 2. 00 | 40. 00 | |Total variable cost |$135. 00 |2,700. 0 | |Fixed costs: | | | |Purchase of special tool | | 250. 00 | |Total incremental cost | | 2,950. 00 | |Incremental net operating income | |$ 449. 00 | Even though the price for the special order is below the companys regular price for such an item, the special order would add to the companys net operating income and should be accepted. This conclusion would not necessarily follow if the special order affected the regula r selling price of bracelets or if it required the use of a constrained resource. Exercise 13-5 (30 minutes) | 1. | |A |B |C | | |(1) |Contribution margin per unit |$54 |$108 |$60 | | |(2) |Direct material cost per unit |$24 |$72 |$32 | | |(3) |Direct material cost per pound |$8 |$8 |$8 | | |(4) |Pounds of material required per unit (2) ? (3) |3 |9 |4 | | |(5) |Contribution margin per pound (1) ? 4) |$18 |$12 |$15 | 2. The company should concentrate its available material on product A: | |A |B |C | |Contribution margin per pound (above) |$ 18 |$ 12 |$ 15 | |Pounds of material available |? 5,000 |? 5,000 |? 5,000 | |Total contribution margin |$90,000 |$60,000 |$75,000 | Although product A has the lowest contribution margin per unit and the second lowest contribution margin ratio, it is preferred over the other two products since it has the greatest amount of contribution margin per pound of material, and material is the company’s constrained resource. 3. The price Barlow Company would be willing to pay per pound for additional raw materials depends on how the materials would be used. If there are unfilled orders for all of the products, Barlow would presumably use the additional raw materials to make more of product A. Each pound of raw materials used in product A generates $18 of contribution margin over and above the usual cost of raw materials. Therefore, Barlow should be willing to pay up to $26 per pound ($8 usual price plus $18 contribution margin per pound) for the additional raw material, but would of course prefer to pay far less. The upper limit of $26 per pound to manufacture more product A signals to managers how valuable additional raw materials are to the company. If all of the orders for product A have been filled, Barlow Company would then use additional raw materials to manufacture product C. The company should be willing to pay up to $23 per pound ($8 usual price plus $15 contribution margin per pound) for the additional raw materials to manufacture more product C, and up to $20 per pound ($8 usual price plus $12 contribution margin per pound) to manufacture more product B if all of the orders for product C have been filled as well. Exercise 13-6 (10 minutes) |A |B |C | |Selling price after further processing |$20 |$13 |$32 | |Selling price at the split-off point |  16 |  Ã‚  8 |  25 | |Incremental reve nue per pound or gallon |$  4 |$  5 |$  7 | |Total quarterly output in pounds or gallons |? 15,000 |? 20,000 |? 4,000 | |Total incremental revenue |$60,000 |$100,000 |$28,000 | |Total incremental processing costs |  63,000 |  Ã‚  80,000 |  36,000 | |Total incremental profit or loss |$(3,000) |$  20,000 |$(8,000) | Therefore, only product B should be processed further. Exercise 13-7 (30 minutes) 1. The relevant costs of a hunting trip would be: |Travel expense (100 miles @ $0. 21 per mile) |$21 | | |Shotgun shells |20 | | |One bottle of whiskey |  15 | | |Total |$56 | This answer assumes that Bill would not be drinking the bottle of whiskey anyway. It also assumes that the resale values of the camper, pickup truck, and boat are not affected by taking one more hunting trip. The money lost in the poker game is not relevant because Bill would have played poker even if he did not go hunting. He plays poker every weekend. The other costs are sunk at the point at which the decision is made to go on another hunting trip. 2. If Bill gets lucky and bags another two ducks, all of his costs are likely to be about the same as they were on his last trip. Therefore, it really doesn’t cost him anything to shoot the last two ducks- except possibly the costs for extra shotgun shells. The costs are really incurred in order to be able to hunt ducks and would be the same whether one, two, three, or a dozen ducks were actually shot. All of the costs, with the possible exception of the costs of the shotgun shells, are basically fixed with respect to how many ducks are actually bagged during any one hunting trip. 3. In a decision of whether to give up hunting entirely, more of the costs listed by John are relevant. If Bill did not hunt, he would not need to pay for: gas, oil, and tires; shotgun shells; the hunting license; and the whiskey. In addition, he would be able to sell his camper, equipment, boat, and possibly pickup truck, the proceeds of which would be considered relevant in this decision. The original costs of these items are not relevant, but their resale values are relevant. Exercise 13-7 (continued) These three requirements illustrate the slippery nature of costs. A cost that is relevant in one situation can be irrelevant in the next. None of the costs- except possibly the cost of the shotgun shells- are relevant when we compute the cost of bagging a particular duck; some of them are relevant when we compute the cost of a hunting trip; and more of them are relevant when we consider the possibility of giving up hunting. Exercise 13-8 (10 minutes) |Contribution margin lost if the Linen Department is dropped: | | |Lost from the Linen Department |$600,000 | |Lost from the Hardware Department (10% ? 2,100,000) |  210,000 | |Total lost contribution margin |810,000 | |Less fixed costs that can be avoided ($800,000 – $340,000) |  460,000 | |Decrease in profits for the company as a whole |$350,000 | Exercise 13-9 (15 minutes) The target production level is 40,000 starters per period, as shown by the relations between per-unit and total fixed costs. | | |â€Å"Cost† Per |Differential Costs | | | | |Unit |Make |Buy |Explanation | | |Direct materials |$3. 10 |$3. 0 | |Can be avoided by buying | | |Direct labor |2. 70 |2. 70 | |Can be avoided by buying | | |Variable manufacturing overhead |0. 60 |0. 60 | |Can be avoided by buying | | |Supervision |1. 50 |1. 50 | |Can be avoided by buying | | |Depreciation |1. 00 |- | |Sunk Cost | | |Rent |0. 0 |- | |Allocated Cost | | |Outside purchase price |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   |$8. 40 | | | |Total cost |$9. 20 |$7. 90 |$8. 40 | | The company should make the starters, rather than continuing to buy from the outside supplier. Making the starters will result in a $0. 50 per starter cost savings, or a total savings of $20,000 per period: $0. 50 per starter ? 40,000 starters = $20,000 Exercise 13-10 (15 minutes) 1. Annual profits will be increased by $39,000: |Per Unit |15,000 Units | |Incremental sales |$14. 00 |$210,000 | |Incremental costs: | | | |Direct materials |5. 10 |76,500 | |Direct labor |3. 80 |57,000 | |Variable manufacturing ov erhead |1. 0 |15,000 | |Variable selling and administrative |  Ã‚  Ã‚  1. 50 |  Ã‚  Ã‚  22,500 | |Total incremental costs |  11. 40 |  171,000 | |Incremental profits |$? 2. 60 |$? 39,000 | The fixed costs are not relevant to the decision, since they will be incurred regardless of whether the special order is accepted or rejected. 2. The relevant cost is $1. 50 (the variable selling and administrative expenses). All other variable costs are sunk, since the units have already been produced. The fixed costs would not be relevant, since they will not change in total as a consequence of the price charged for the left-over units. Exercise 13-11 (15 minutes) The company should accept orders first for C, second for A, and third for B. The computations are: | | |A |B |C | |(1) |Direct materials required per unit |$24 |$15 |$9 | |(2) |Cost per pound |$3 |$3 |$3 | |(3) |Pounds required per unit (1) ? 2) |8 |5 |3 | |(4) |Contribution margin per unit |$32 |$14 |$21 | |(5) |Contribution margin per pound of materials used (4) ? (3) |$4. 00 |$2. 80 |$7. 00 | Since C uses the least amount of material per unit of the three products, and since it is the most profitable of the three in terms of its use of materials, some students will immediately assume that this is an infallible relationship. That is, they will assume that the way to spot the most profitable product is to find the one using the least amount of the constrained resource. The way to dispel this notion is to point out that product A uses more material (the constrained resource) than does product B, but yet it is preferred over product B. The key factor is not how much of a constrained resource a product uses, but rather how much contribution margin the product generates per unit of the constrained resource. Exercise 13-12 (10 minutes) |Sales value if processed further |$84,000 | |(7,000 units ? $12 per unit) | | |Sales value at the split-off point |  63,000 | |(7,000 units ? 9 per unit) | | |Incremental revenue |21,000 | |Less cost of processing further |  Ã‚  9,500 | |Net advantage of processing further |$11,500 | Exercise 13-13 (20 minutes) | 1. |Fixed cost per mile ($5,000* ? 50,000 miles) |$0. 10 | | |Variable cost per mile |  0. 7 | | |Average cost per mile |$0. 17 | | |* |Insurance |$1,600 | | | |Licenses |250 | | | |Taxes |150 | | | |Garage rent |1,200 | | | |Depreciation |  1,800 | | | |Total |$5,000 | This answer assumes the resal e value of the truck does not decline because of the wear and tear that comes with use. 2. The insurance, the licenses, and the variable costs (gasoline, oil, tires, and repairs) would all be relevant to the decision, since these costs are avoidable by not using the truck. (However, the owner of the garage might insist that the truck be insured and licensed if it is left in the garage. In that case, the insurance and licensing costs would not be relevant since they would be incurred regardless of the decision. ) The taxes would not be relevant, since they must be paid regardless of use; the garage rent would not be relevant, since it must be paid to park the truck; and the depreciation would not be relevant, since it is a sunk cost. However, any decrease in the resale value of the truck due to its use would be relevant. 3. Only the variable costs of $0. 07 would be relevant, since they are the only costs that can be avoided by having the delivery done commercially. 4. In this case, only the fixed costs associated with the second truck would be relevant. The variable costs would not be relevant, since they would not differ between having one or two trucks. (Students are inclined to think that variable costs are always relevant in decision-making, and to think that fixed costs are always irrelevant. This requirement helps to dispel that notion. ) Exercise 13-14 (30 minutes) No, the bilge pump product line should not be discontinued. The computations are: Contribution margin lost if the line is dropped | |â‚ ¬(460,000) | |Fixed costs that can be avoided: | | | |Advertising |â‚ ¬270,000 | | |Salary of the product line manager |32,000 | | |Insurance on inventories |  Ã‚  Ã‚  Ã‚  Ã‚  8,000 |  Ã‚  Ã‚  310, 000 | |Net disadvantage of dropping the line | |â‚ ¬(150,000) | The same solution can be obtained by preparing comparative income statements: | |Keep Product Line |Drop Product Line |Difference: Net | | | | |Operating Income | | | |Increase or (Decrease) | |Sales |â‚ ¬850,000 |â‚ ¬Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |â‚ ¬(850,000) | |Less variable expenses: | | | | |Variable manufacturing expenses |330,000 |0 |330,000 | |Sales commissions |42,000 |0 |42,000 | |Shipping |  Ã‚  Ã‚  Ã‚  18,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  Ã‚  Ã‚  Ã‚  18,000 | |Total variable expenses |  Ã‚  390,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  Ã‚  390,000 | |Contribution margin |  Ã‚  460,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  (460,000) | |Less fixed expenses: | | | | |Advertising |270,000 |0 |270,000 | |Depreciation of equipment |80,000 |80,000 |0 | |General factory overhead |105,000 |105,000 |0 | |Salary of product line manager |32,000 |0 |32,000 | |Insurance on inventories |8,000 |0 |8,000 | |Purchasing department expenses |  Ã‚  Ã‚  Ã‚  45,000 |  Ã‚  Ã‚  Ã‚  Ã‚  45,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 | |Total fixed expenses |  Ã‚  540,000 |  Ã‚  Ã‚  230,000 |  Ã‚  Ã‚  310,000 | |Net operating loss |â‚ ¬Ã‚  (80,000) |â‚ ¬(230,000) |â‚ ¬(150,000) | Exercise 13-15 (20 minutes) The costs that are relevant in a make-or-buy decision are those costs that can be avoided as a result of purchasing from the outside. The analysis for this exercise is: |Per Unit | |30,000 Units | | |Differential Costs | | | | |Make | |Buy | |Make | |Buy | |Cost of purchasing | | |$21. 00 | | | |$630,000 | |Cost of making: | | | | | | | | |Direct materials |$? 3. 60 | | | |$108,000 | | | |Direct labor |10. 00 | | | |300,000 | | | |Variable overhead |2. 0 | | | |72,000 | | | |Fixed overhead |  Ã‚  Ã‚  3. 00 |* |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | |  Ã‚  Ã‚  90,000 | |     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | |Total cost |$19. 00 | |$21. 00 | |$570,000 | |$630,000 | |* |The remaining $6 of fixed overhead cost would not be relevant, since it will continue regardless of whether the company | | |makes or buys the parts. | The $80,000 rental value of the space being used to produce part S-6 represents an opportunity cost of continuing to produce the part internally. Thus, the completed analysis would be: |Make |Buy | |Total cost, as above |$570,000 |$630,000 | |Rental value of the space (opportunity cost) |  Ã‚  Ã‚  80,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | |Total cost, including opportunity cost |$650,000 |$630,000 | |Net advantage in favor of buying | |$20,000 | | Problem 13-16 (30 minutes) | 1. Contribution margin lost if the flight is | |$(12,950) | | |discontinued | | | | |Flight costs that can be avoided if the flight is discontinued: | | | | |Flight promotion |$  Ã‚  750 | | | |Fuel for aircraft |5,800 | | | |L iability insurance (1/3 ? $4,200) |1,400 | | | |Salaries, flight assistants |1,500 | | | |Overnight costs for flight crew and assistants |  Ã‚  Ã‚  Ã‚  300 |  Ã‚  Ã‚  Ã‚  9,750 | | |Net decrease in profits if the flight is discontinued | |$? 3,200) | The following costs are not relevant to the decision: |Cost | |Reason | | | | | |Salaries, flight crew | |Fixed annual salaries, which will not change. | | | | | |Depreciation of aircraft | |Sunk cost. | | | | |Liability insurance (two-thirds) | |Two-thirds of the liability insurance is unaffected by this | | | |decision. | | | | | |Baggage loading and flight preparation | |This is an allocated cost that will continue even if the flight is | | | |discontinued. | Problem 13-16 (continued) Alternative Solution: |Keep the Flight |Drop the Flight |Difference: Net | | | | |Operating Income | | | | |Increase or (Decrease) | |Ticket revenue |$14,000 |$  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |$(14,000) | |Less variable expenses |  Ã‚  Ã‚  1,050 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  Ã‚  Ã‚  Ã‚  1,050 | |Contribution margin |  12,950 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  (12,950) | |Less flight expenses: | | | | |Salaries, flight crew |1,800 |1,800 |0 | |Flight promotion |750 |0 |750 | |Depreciation of aircraft |1,550 |1,550 |0 | |Fuel for aircraft |5,800 0 |5,800 | |Liability insurance |4,200 |2,800 |1,400 | |Salaries, flight assistants |1,500 |0 |1,500 | |Baggage loading and flight preparation |1,700 |1,700 |0 | |Overnight costs for flight crew and |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  300 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  300 | |assistants at destination | | | | |Total flight expenses |  Ã‚  17,600 |  Ã‚  Ã‚  Ã‚  7,850 |  Ã‚  Ã‚  Ã‚  9,750 | |Net operating loss |$ (4,650) |$ (7,850) |$  Ã‚  (3,200) | 2. The goal of increasing the seat occupancy could be obtained by eliminating flights with a lower-than-average seat occupancy. By eliminating these flights and keeping the flights with a hig her average seat occupancy, the overall average seat occupancy for the company as a whole would be improved. This could reduce profits, however, in at least two ways. First, the flights that are eliminated could have contribution margins that exceed their avoidable costs (such as in the case of flight 482 in part 1). If so, then eliminating these flights would reduce the company’s total contribution margin more than it would reduce total costs, and profits would decline. Second, these flights might be acting as â€Å"feeder† flights, bringing passengers to cities where connections to more profitable flights are made. Problem 13-17 (15 minutes) 1. | |Per 16-Ounce T-Bone | |Revenue from further processing: | | |Sales price of one filet mignon (6 ounces ? $4. 00 per pound ? 6 ounces per pound) |$1. 50 | |Sales price of one New York cut (8 ounces ? $2. 80 per pound ? 16 ounces per pound) |  1. 40 | |Total revenue from further processing |2. 90 | |Less sales revenue from one T-bone steak |  2. 25 | |Incremental revenue from further processing |0. 65 | |Less cost of further processing |  0. 5 | |Profit per pound from further proce ssing |$0. 40 | 2. The T-bone steaks should be processed further into the filet mignon and the New York cut. This will yield $0. 40 per pound in added profit for the company. The $0. 45 â€Å"profit† per pound shown in the text is not relevant to the decision, since it contains allocated joint costs. The company will incur the joint costs regardless of whether the T-bone steaks are sold outright or processed further; thus, this cost should be ignored in the decision. Problem 13-18 (60 minutes) 1. The simplest approach to the solution is: Gross margin lost if the store is closed | | |$(316,800) | |Costs that can be avoided: | | | | |Sales salaries |$70,000 | | | |Direct advertising |51,000 | | | |Store rent |85,000 | | | |Delivery salaries |4,000 | | | |Store management salaries |9,000 | | | |($21,000 – $12,000) | | | | Salary of new manager |11,000 | | | |General office compensation |6,000 | | | |Insurance on inventories ($7,500 ? 2/3) |5,000 | | | |Utilities |31 ,000 | | | |Employment taxes |  15,000 |* |  Ã‚  Ã‚  287,000 | |Decrease in company profits if the North Store is closed | | |$  (29,800) | *Salaries avoided by closing the store: | | | Sales salaries |$70,000 | | Delivery salaries |4,000 | | Store management salaries |9,000 | | Salary of new manager |11,000 | | General office compensation |  Ã‚  Ã‚  6,000 | | Total avoided |100,000 | | Employment tax rate | 5% | | Employment taxes avoided |$15,000 | Problem 13-18 (continued) Alternative Solution: | |North Store Kept |North Store Closed |Difference: Net | | |Open | |Operating Income | | | | |Increase or (Decrease) | |Sales |$720,000 |$? 0 |$(720,000) | | |Less cost of goods sold   403,200 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  Ã‚  Ã‚  403,200 | | |Gross margin |  316,800 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 |  (316,800) | | |Operating expenses: | | | | | |Selling expenses: | | | | | |Sales salaries |70,000 |0 |70,000 | | |Direct advertising |51,000 |0 |51,000 | | |General advertising |10,800 |10,800 |0 | | |Store rent |85,000 |0 |85,000 | | |Depreciation of store fixtures |4,600 |4,600 |0 | | |Delivery salaries |7,000 |3,000 |4,000 | | |Depreciation of delivery equipment |  Ã‚  Ã‚  Ã‚  3,000 |  Ã‚  Ã‚  Ã‚  3,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 | | |Total selling expenses |  231,400 |  Ã‚  21,400 |  210,000 | | |Administrative expenses: | | | | | |Store management salaries |21,000 |12,000 |9,000 | | |Salary of new manager |11,000 |0 |11,000 | | |General office compensation |12,000 |6,000 |6,000 | | |Insurance on fixtures and |7,500 |2,500 |5,000 | | |inventory | | | | | |Utilities |31,000 |0 |31,000 | | |Employment taxes |18,150 |3,150 |15,000 |* | General office- other |  Ã‚  Ã‚  18,000 |  Ã‚  18,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  0 | | |Total administrative expenses |  118,650 |  Ã‚  41,650 |  Ã‚  Ã‚  Ã‚  77,000 | | |Total operating expenses |  350,050 |  Ã‚  63,050 |  Ã‚  287,000 | | |Net operating income (loss) |$(33,250) |$(63,050) |$  (29,800) | | *See the computation on the prior page. Problem 13-18 (continued) 2. Based on the data in (1), the North Store should not be closed. If the store is closed, then the company’s overall net operating income will decrease by $29,800 per quarter. If the store space cannot be subleased or the lease broken without penalty, a decision to close the store would cause an even greater decline in the company’s overall net income. If the $85,000 rent cannot be avoided and the North Store is closed, the company’s overall net operating income would be reduced by $114,800 per quarter ($29,800 + $85,000). 3. Under these circumstances, the North Store should be closed. The computations are as follows: |Gross margin lost if the North Store is closed (part 1) |$(316,800) | |Gross margin gained from the East Store: $720,000 ? 1/4 = $180,000; $180,000 ? 5%* = $81,000 |  Ã‚  Ã‚  Ã‚  81,000 | |Net operating loss in gross margin |(235,800) | |Less costs that can be avoided if the North Store is closed (part 1) |  Ã‚  Ã‚  287,000 | |Net advantage of closing the North Store |$? 51,200 | *The East Store’s gross margin percentage is: $486,000 ? $1,080,000 = 45% Problem 13-19 (60 minutes) 1. The $90,000 in fixed overhead cost s charged to the new product is a common cost that will be the same whether the tubes are produced internally or purchased from the outside. Hence, they are not relevant. The variable manufacturing overhead per box of Chap-Off would be $0. 50, as shown below: Total manufacturing overhead cost per box of Chap-Off |$1. 40 | |Less fixed portion ($90,000 ? 100,000 boxes) |  0. 90 | |Variable overhead cost per box |$0. 50 | The total variable costs of producing one box of Chap-Off would be: |Direct materials |$3. 60 | |Direct labor |2. 00 | |Variable manufacturing overhead |  0. 0 | |Total variable cost per box |$6. 10 | If the tubes for the Chap-Off are purchased from the outside supplier, then the variable cost per box of Chap-Off would be: |Direct materials ($3. 60 ? 75%) |$2. 70 | |Direct labor ($2. 00 ? 90%) |1. 80 | |Variable manufacturing overhead ($0. 50 ? 90%) |0. 45 | |Cost of tube from outside |  1. 5 | |Total variable cost per box |$6. 30 | Therefore, the company sho uld reject the outside supplier’s offer. A savings of $0. 20 per box of Chap-Off will be realized by producing the tubes internally. Problem 13-19 (continued) Another approach to the solution would be: |Cost avoided by purchasing the tubes: | | |Direct materials ($3. 60 ? 25%) |$0. 90 | |Direct labor ($2. 00 ? 10%) |0. 20 | |Variable manufacturing overhead ($0. 50 ? 0%) |  0. 05 | |Total costs avoided |$1. 15 |* | | | | |Cost of purchasing the tubes from the outside |$1. 35 | | | | |Cost savings per box by making internally |$0. 20 | |* |This $1. 5 is the cost of making one box of tubes internally, since it represents the overall cost savings that | | |will be realized per box of Chap-Off by purchasing the tubes from the outside. | 2. The maximum purchase price would be $1. 15 per box. The company would not be willing to pay more than this amount, since the $1. 15 represents the cost of producing one box of tubes internally, as shown in Part 1. To make purchasing the t ubes attractive, however, the purchase price should be less than $1. 15 per box. Problem 13-19 (continued) 3. At a volume of 120,000 boxes, the company should buy the tubes. The computations are: |Cost of making 120,000 boxes: | | |120,000 boxes ? $1. 5 per box |$138,000 | |Rental cost of equipment |  Ã‚  Ã‚  40,000 | |Total cost |$178,000 | | | | |Cost of buying 120,000 boxes: | | |120,000 boxes ? $1. 35 per box |$162,000 | | | | |Or, on a total cost basis, the computations are: | | | | | |Cost of making 120,000 boxes: | | |120,000 boxes ? 6. 10 per box |$732,000 | |Rental cost of equipment |  Ã‚  Ã‚  40,000 | |Total cost |$772,000 | | | | |Cost of buying 120,000 boxes: | | |120,000 boxes ? $6. 30 per box |$756,000 | Thus, buying the boxes will save the company $16,000 per year. Problem 13-19 (continued) 4. Under these circumstances, the company should make the 100,000 boxes of tubes and purchase the remaining 20,000 boxes from the outside supplier. The costs would: |Cost of making: 100,000 boxes ? $1. 15 per box |$115,000 | |Cost of buying: 20,000 boxes ? $1. 35 per box |  Ã‚  Ã‚  27,000 | |Total cost |$142,000 | Or, on a total cost basis, the computation would be: Cost of making: 100,000 boxes ? $6. 10 per box |$610,000 | |Cost of buying: 20,000 boxes ? $6. 30 per box |  126,000 | |Total cost |$736,000 | Since the amount of cost under this alternative is $20,000 less than the best alternative in Part 3, the company should make as many tubes as possible with the current equipment and buy the remaining tubes from the outside supplier. 5. Management should take into account at least the following additional factors: )The ability of the supplier to meet required delivery schedules. b)The qu ality of the tubes purchased from the supplier. c)Alternative uses of the capacity that would be used to make the tubes. d)The ability of the supplier to supply tubes if volume increases in future years. e)The problem of alternative sources of supply if the supplier proves undependable. Problem 13-20 (30 minutes) 1. Since the fixed costs will not change as a result of the order, they are not relevant to the decision. The cost of the new machine is relevant, and this cost will have to be recovered by the current order since there is no assurance of future business from the retail chain. |Unit |Total- 5,000 units | |Revenue from the order ($50 ? 84%) |$42 |$210,000 | |Less costs associated with the order: | | | |Direct materials |15 |75,000 | |Direct labor |8 |40,000 | |Variable manufacturing overhead |3 |15,000 | |Variable selling expense ($4 ? 25%) |1 |5,000 | |Special machine ($10,000 ? ,000 units) |  Ã‚  Ã‚  2 |  Ã‚  Ã‚  10,000 | |Total costs |  29 |  145,000 | |Net in crease in profits |$13 |$  65,000 | | 2. |Revenue from the order: | | | |Reimbursement for costs of production (variable production costs of $26, plus fixed manufacturing |$175,000 | | |overhead cost of $9 = $35 per unit; $35 per unit ? 5,000 units) | | | |Fixed fee ($1. 80 per unit ? ,000 units) |  Ã‚  Ã‚  Ã‚  Ã‚  9,000 | | |Total revenue |184,000 | | |Less incremental costs- variable production costs |  130,000 | | |($26 per unit ? 5,000 units) | | | |Net increase in profits |$  54,000 | | 3. |Sales revenue: | | | |From the U. S. Army (above) |$184,000 | | |From regular channels ($50 per unit ? 5,000 units) |  250,000 | | |Net decrease in revenue |(66,000) | | |Less variable selling expenses avoided if the Army’s order is accepted ($4 per unit ? 5,000 units) |  Ã‚  Ã‚  20,000 | | |Net de

How Political Lines or Action can affect and improve the different Essay

How Political Lines or Action can affect and improve the different sectors of the Economy in UK - Essay Example Leading publications are stuffed with articles about the political economic system of economic occurrence or a different; Specialty journals are actually started; conferences with a specific fiscal issue typically have no less than one paper about the politics on the issue, let alone numerous meetings devoted only to political economy. Simply speaking, it seems justified to talk about the new politics, economy as an important subject of recent research also to conclude that this is not simply a new fad, but a location of analysis thats here to keep. In limited, the political economic system falls in that specific class of stuff that seem pretty old as well as musty as well as quite younger and fresh while doing so (Press.princeton.edu, 2014). Politics and financial system are without a doubt two distinct fields, yet greatly associated as they said; politics cannot be fully understood without the economics in addition to vice versa. In UK, politics really end up in the matter in economics; on who have lost the money and the amount as the challenge of personal dilemma has been tackled. With the economics, they just find the problem as a mere economic crisis; but in terms of political economy, the challenge has something to do with the tricks of personal letters. Possessing these problems, political system could even be questioned in its ability on solving and producing decision on the matter. A key area regarding government economic policy could be the role that the government gives to the state within the economy. The key to your smooth running economy is usually having appeared fiscal as well as monetary insurance policies. We have to have policies that could be changed after a while to far better serve your economy overall. The UK economy has had its good and bad, and the actual economy is probably in a new downward time now, but economic and monetary policies are usually adjusted to adjust to what is most beneficial for