Read the attached case study titled â??Naval Operating Base, Arkladelphiaâ? in which you are given a scenario regarding difficulties faced by a negotiator in a â??sole sourceâ? situation. Read through the case study and answer the three questions at the end regarding what Lieutenant Early should do. Justify your answers with research in a one to two page paper, double spaced, APA format with in text citations and references.
1. Should Lieutenant Early question costs that appear to be caused by "inefficient management"?
Yes, Lieutenant Early should question costs that appear to be caused by "inefficient management", the manufacturing overheads of 170 percent of direct labor is very steep, the engineering overhead of 93 percent of direct engineering labor is also very high. Usually, manufacturing overhead includes the depreciation of building, equipment, and machinery. It also includes supervisors, quality control and maintenance. Lieutenant Early should compare the charges that have been mentioned by Trustworthy Equipment Company with the industry average. The difference will reveal the level of inefficiencies of Trustworthy Equipment Company. The General and Administrative expenses as 25% of operating costs is also unusually high. Usually, such costs include the salaries of non-sales personnel, rent, heat and lights. Usually this figure is calculated as a percent of the sales or net income and compared to industry average. if Lieutenant Early ...
?Naval Operating Base, Arkladelphiaâ is discussed very comprehensively in this explanation..