Decision Making Across the Organization

Decision Making Across the Organization Essay example
Masters
Essay
Finance & Accounting
Pages 3 (753 words)
Download 0
Decision Making Across the Organization Name: Institution: Course: Tutor: a) Calculate the estimated break-even point in annual unit sales of the new product if Martinez Company uses the: (1) Capital-intensive manufacturing method. Capital intensive manufacturing method entail a method of production that requires large amounts of capital investments to produce goods and services…

Introduction

Therefore, Martinez Company may use this method to determine the break-even point in annual unit sales of the new product. The break even points may be computed as follows; if Martinez’s market research department has recommended an introductory unit sales price of $30. The incremental selling expenses are estimated to be $502,000 annually plus $2 for each unit sold, regardless of manufacturing method. Therefore, it is vital to note that the incremental and $2 are irrelevant cost in this case because irrespective of their presence they may not affect organisation decision making (Weygandt, Kieso, & Kimmel, 2010) Variable cost Direct materials $5 per unit Direct labor $6 per unit Variable overhead $3 per unit Total Variable Cost $14 Fixed Cost Fixed manufacturing costs $2,508,000 Break Even Point= Fixed Costs Price-Variable Cost per Unit Break Even Point=$2508, 000=156750Unit $30-14 (2) Labor-intensive manufacturing method. Labor intensive method entails a production method that utilizes more labor and little capital to produce substantial amounts of goods and services. Under this method, a lot of task might be involved and therefore, substantial amount of salary expense incurred (Weygandt, Kieso & Kimmel, 2010). ...
Download paper
Not exactly what you need?

Related papers

Managerial Accounting for Decision Making
Horngren and Sundem, 1990. P- 4’ (MACINTOSH & QUATTRONE. 2010) Management accounting system is a part of the larger control system in the organization used to measure, monitor and motivate the managers and employees in the organization and also to coordinate with the other components of the organization like machine, information, material and technologies etc. For a robust control system it is…
Managerial Decision Making
PART 1 Formal research and business proposal are terminologies that bear commonalities and differences. While formal research is defined as conducting an experiment under proscribed conditions so as to find out, reveal or assess a hypothesis, business proposal is defined as the methodical collection of information with the objective of arriving at the most appropriate solution for a given problem…
Managerial Decision Making
I have also been asked to perform a self evaluation of the decisions made and to evaluate them myself as to whether I think they were a success or failure for the organization. My supervisor has asked me to email him this evaluation as part of my own yearly evaluation which will be used to decide my yearly bonus, so I have decided to make it as professional as possible. Discussion In posting my…
Financial Reporting and Analysis for Decision Making
There appears no true definition under the ordinance or the HKAS. Most cases require the knowledge of the accountant discretion. When companies comply with the Company’s Ordinance the HKAS depicts the situation as true and fair. The moment there appears a problem; the term comes straight from the legislative or the investment discretion (Oporowski, 2005). Hong Kong citizens tend to analyze the…
management accounting & decision making
As at September 30, 20X0 Property, Plant and Equipment 1,840,000 Less: Depreciation (133,167) Net Book Value 1,706,833 Inventory 9,000 Receivables 144,585 Cash 172,700 Total Assets 2,033,118 Owner's Capital 2,000,000 Profit for the year (92) Creditors 12,960 Overhead cost payable 20,250 Total capital and liabilities 2,033,118 The above statement presents the cash budget, income statement and the…
Accounting and Decision Making
It is prudent to treat such income as accrued or deferred income as it has not been received and should not be treated as sales income (Nikolai et al 2009). The accounting standards require that revenue should be recognized when earned and received. Invoices raised on a long term contract for a customer show an ending balance of 219,750. The company is confident that the amount will be fully…
Accounting For Decision Making
To do this, we had to conduct research on the two companies’ performance over the years and analyzed the data using financial ratios and statistical graphs. From our findings we found out that fantastic holdings has good gross profit margins but has higher expenses rates which reduces the net profit margin (Whiteside 2007). It was also evident that fantastic holdings has good profits in…