The Tolar Company has 400 obsolete desk calculators that are carried in inventory at a total historic cost of £26,800. If these calculators are upgraded at a total cost of £10,000, they can be sold for a total of £30,000. As an alternative, the calculators can be sold in their present condition for £11,200. If Talar decided to sell the calculators in their present condition it will incur an opportunity cost of: a. £20,000 O b. £30,000 O c. £26,800 O d. £15,600
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- The Tingey Company has 500 obsolete microcomputers that are carried in inventory at a total cost of £720,000. If these microcomputers are upgraded at a total cost of £100,000, they can be sold for a total of £160,000. As an alternative, the microcomputers can be sold in their present condition for £50,000.The sunk cost in this situation is:The Tingey Company has 500 obsolete microcomputers that are carried in inventory at a total cost of $720,000. If these microcomputers are upgraded at a total cost of $140,000, they can be sold for a total of $200,000. As an alternative, the microcomputers can be sold in their present condition for $50,000. Suppose the sélling price of the upgraded computers has not been set. At what selling price per unit would the company be as well off upgrading the computers as if it just sold the computers in their present condition?The Tolar Corporation has 300 obsolete desk calculators that are carried in inventory at a total cost of $432,000. If these calculators are upgraded at a total cost of $120,000, they can be sold for a total of $180,000. As an alternative, the calculators can be sold in their present condition for $30,000. Assume that Tolar decides to upgrade the calculators. At what selling price per unit would the company be as well off as if it just sold the calculators in their present condition? O $40 per calculator O $154 per calculator O $500 per calculator O $90 per calculator
- The Tolar Corporation has 500 obsolete desk calculators that are carried in inventory at a total cost of $720.000. If these calculators are upgraded at a total cost of $110.000, they can be sold for a total of $170,000 As an alternative, the calculators can be sold in their present condition for $50,000 Assume that Tolar decides to upgrade the calculators. At what selling price per unit would the company be as well off as if it just sold the calculators in their present condition? Multiple Choce $770 per calculator Sho per calculat $230 per calculatorMcDonald (Agricultural Engineers) Ltd recently built a machine for a farmer at a cost of £22,000. The farmer, however, was recently declared bankrupt and so is unable to take delivery of the machine. Another farmer has offered to buy the machine if certain adaptations are made. These adaptations will require four components, which are held in inventories. The components cost £800 each and are frequently used by the business. The current replacement price per component is £850 and their realisable value is £420 per component. To fit the components, skilled labour, which costs £18 per hour must be used. The job will take 16 hours and it will mean taking two workers off another job. This job could be done by semi-skilled workers, who are paid £12 per hour but have no work available until next week. The business has received an offer from an agricultural supplier to buy the machine in its current condition for £10,000. What is the minimum price at which the business should…The production department of Y Company is planning to purchase a new machine to improve product quality. The company’s management accountant is currently evaluating two options- Buy the machine OR Rent it. The following information is available: The company has to pay £3,200 to set up the machine. Insurance costs £450 per annum. If it is bought, the new machine is depreciated on a reducing balance basis at the rate of 25%. After various calculations, the company has to pay £4,200 maintenance cost every year, and the estimated repair cost would be £300 per year. The firm will have to sell old machines, which had cost £65,000 six years ago. Apart from the above information, the £500 delivery cost is incurred for this purchase option. If it is rented, £ 4,650 per year to pay as rent. There is no cost for repair and maintenance. However, the firm is required to pay the administration charge of £650 with this rent option. For the rent option, the delivery cost remains at 20% of the £ 500…
- The production department of Y Company is planning to purchase a new machine to improve product quality. The company’s management accountant is currently evaluating two options- Buy the machine OR Rent it. Following information is available: The company has to pay £3,200 to set up the machine. Insurance cost £450 per annum. If it is bought, the new machine is depreciated on reducing balance basis at the rate of 25%. After various calculations, the company has to pay £4,200 maintenance cost every year and estimated repair cost would be £300 per year. The firm will have to sell old machines, which had cost £65,000 six years ago. Apart from the above information, the £500 of delivery cost is incurred for this purchase option. If it is rented, £4,650 per year to pay as rent. There is no cost for repair and maintenance. However, the firm is required to pay the administration charge of £650 with this rent option. For rent option, the delivery cost remains at 20% of the £ 500 (the delivery…The production department of Y Company is planning to purchase a new machine to improve product quality. The company’s management accountant is currently evaluating two options- Buy the machine OR Rent it. Following information is available: The company has to pay £3,200 to set up the machine. Insurance cost £450 per annum. If it is bought, the new machine is depreciated on reducing balance basis at the rate of 25%. After various calculations, the company has to pay £4,200 maintenance cost every year and estimated repair cost would be £300 per year. The firm will have to sell old machines, which had cost £65,000 six years ago. Apart from the above information, the £500 of delivery cost is incurred for this purchase option. If it is rented, £ 4,650 per year to pay as rent. There is no cost for repair and maintenance. However, the firm is required to pay the administration charge of £650 with this rent option. For rent option, the delivery cost remains at 20% of the £ 500 (the delivery…The production department of Y Company is planning to purchase a new machine to improve product quality. The company’s management accountant is currently evaluating two options- Buy the machine OR Rent it. Following information is available: The company has to pay £3,200 to set up the machine. Insurance cost £450 per annum. If it is bought, the new machine is depreciated on reducing balance basis at the rate of 25%. After various calculations, the company has to pay £4,200 maintenance cost every year and estimated repair cost would be £300 per year. The firm will have to sell old machines, which had cost £65,000 six years ago. Apart from the above information, the £500 of delivery cost is incurred for this purchase option. If it is rented, £ 4,650 per year to pay as rent. There is no cost for repair and maintenance. However, the firm is required to pay the administration charge of £650 with this rent option. For rent option, the delivery cost remains at 20% of the £ 500 (the…
- Your company has a customer who is shutting down a production line, and it is your responsibility to dispose of the extrusion machine. The company could keep it in inventory for a possible future product and estimates that the reservation value is $150,000. Your dealings on the secondhand market lead you to believe that if you commit to a price of $200,000, there is a 0.5 chance you will be able to sell the machine. If you commit to a price of $250,000, there is a 0.3 chance you will be able to sell the machine. If you commit to a price of $300,000, there is a 0.1 chance you will be able to sell the machine. These probabilities are summarized in the following table. For each posted price, enter the expected value of attempting to sell the machine at that price. (Hint: Be sure to take into account the value of the machine to your company in the event that you are not be able to sell the machine.) Posted Price Probability of Sale Expected Value ($) ($) $300,000 0.1…Green Company can purchase a new machine for $100,000. The new machine will have a five-year life with no salvage value. The machine should reduce labor costs by $22,000 per year. Green Company would have to scrap its existing machine, receiving no cash. The existing machine has a book value of $15,000. Should Green purchase the new machine? Yes, as the decreased labor costs are greater than the cost of the new machine. No, as the decreased labor costs are less than the cost of the new machine plus the book value of the existing machine. No, as the decreased labor costs are less than the cost of the new machine. Yes, as the decreased labor costs are greater than the cost of the new machine plus the book value of the existing machine.1. Your company has a customer who is shutting down a production line, and it is your responsibility to dispose of the extrusion machine. The company could keep it in inventory for a possible future product and estimates that the reservation value is $100,000. Your dealings on the secondhand market lead you to believe that if you commit to a price of $200,000, there is a 0.5 chance you will be able to sell the machine. If you commit to a price of $300,000, there is a 0.2 chance you will be able to sell the machine. If you commit to a price of $400,000, there is a 0.15 chance you will be able to sell the machine. These probabilities are summarized in the following table. For each posted price, enter the expected value of attempting to sell the machine at that price. (Hint: Be sure to take into account the value of the machine to your company in the event that you are not be able to sell the machine.) Posted Price Probability of Sale Expected Value ($) ($) $400,000 0.15 $300,000 0.2…