The following are the jensen corporation's unit costs of making and selling an item at a volume of 1,000 units per month (which represents the company's capacity):

manufacturing:
direct materials $1.00
direct labor $2.00
variable overhead $0.50
fixed overhead $0.40

selling and administrative:
variable $2.00
fixed $0.80

present sales amount to 700 units per month. an order has been received from a customer in a foreign market for 100 units. the order would not affect current sales. fixed costs, both manufacturing and selling and administrative, are constant within the relevant range between 700 units and 1,000 units. the variable selling and administrative expenses would have to be incurred on this special order as well as for all other sales. direct labor is a variable cost.

assume the company has 50 units left over from last year which have small defects and which will have to be sold at a reduced price for scrap. the sale of these defective units will have no effect on the company's other sales. which of the following costs is relevant in this decision?

a. $3.50 variable manufacturing cost
b. $3.90 unit product cost
c. $2.00 variable selling and administrative cost
d. $6.70 full cost

David burdick is the ceo of acme bubblegum, a successful public company. as one of the cofounders of the company, burdick has enjoyed speaking and writing about the success of acme bubblegum for several years. typically, he speaks at conferences or directly to the press, but recently, he has been blogging about his firm anonymously. specifically, he defended a recent advertising campaign that was unpopular among consumers and pointedly attacked one of acme bubblegum’s competitors. burdick deeply enjoys his anonymous blogging and believes that none of his readers actually know that he works for acme bubblegum. should burdick be allowed to praise his company’s performance anonymously online? should he be allowed to attack his competitors without disclosing his relationship with the company? how would you feel if the ceo of a company at which you shopped was secretly writing criticisms of his or her competition? how would you feel if you knew a writer for your favorite blog was actually closely involved in a company that the blog discussed? 1. define the ethical issue? 2. who are the primary stakeholders? 3. what are the possible alternatives? 4. how could you evaluate the ethical implications of the alternative actions (use appropriate decision rules)? 5. what action would you recommend and why?

Xinhong company is considering replacing one of its manufacturing machines. the machine has a book value of $39,000 and a remaining useful life of 5 years, at which time its salvage value will be zero. it has a current market value of $49,000. variable manufacturing costs are $33,300 per year for this machine. information on two alternative replacement machines follows. alternative a alternative b cost $ 115,000 $ 117,000 variable manufacturing costs per year 22,900 10,100 1. calculate the total change in net income if alternative a and b is adopted. 2. should xinhong keep or replace its manufacturing machine

Mr. beautiful, an organization that sells weight training sets, has an ordering cost of $40 for the bb-1 set. (bb-1 stands for body beautiful number 1.) the carrying cost for bb-1 is $5 per set per year. to meet demand, mr. beautiful orders large quantities of bb-1 seven times a year. the stockout cost for bb-1 is estimated to be $50 per set. over the past several years, mr. beautiful has observed the following demand during the lead time for bb-1: demand during lead time probability40 0.150 0.260 0.270 0.280 0.290 0.1total 1.0the reorder point for bb-1 is 60 sets. what level of safety stock should be maintained for bb-1?