Author Question: Premier Corp expects to spend $800,900 in 2017 in appraisal costs if it does not change its incoming ... (Read 124 times)

nramada · **on:** Mar 6, 2021

Premier Corp expects to spend $800,900 in 2017 in appraisal costs if it does not change its incoming materials inspection method. If it decides to implement a new receiving method, it will save $60,500 in fixed appraisal costs and variable costs of $0.50 per unit of finished product. The new method involves $140,500 in training costs and an additional $150,300 in annual equipment rental.

Internal failure costs average $250 per failed unit of finished goods. During 2016, 6% of all completed items had to be reworked. External failure costs average $450 per failed unit. The company's average external failures are 2% of units sold. The company carries no ending inventories, because all jobs are on a per order basis and a just-in-time inventory ordering method is used.

What would be the change in the external failure budget, if 600,300 units are used and assuming external failures are reduced by 12%.
◦ $48,054 increase
◦ $250,150 decrease
◦ $648,324 decrease
◦ $304,342 decrease

mjenn52 · **Reply #1 on:** Mar 6, 2021

A FREE account is required to view all solutions!

Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.

Answer Preview

Only 58% of students answer this correctly