Barneycle's Boat Shop, Neat-O-Widgets: optimum order quantity and AR disount

Barneycle's Boat Shop sells 3000 of its glow-in-the-dark boats each year and has fixed order costs of $120 per order. Carrying cost per boat is $150 per year. What is the optimal order quantity for these boats?

a. 69
b. 87
c. 98
d. 133
e. 1200

Neat-O-Widgets (NOW) must decide whether changing its credit policy from net 30 to 2 / 10 net 30 would be beneficial. The cash discount should increase sales from 1,900 to 2,000 units per year, and 64 percent of NOW's customers will likely take the discount. The bad debt percentage will not be altered. NOW sells each unit for $2,500, with a variable cost per unit of $2,170. NOW has calculated the cost savings from reduced investment in accounts receivable from the proposed discount to be $29,219. NOW should:

a. offer the discount as it results in a net profit of $34,781
b. offer the discount as it results in a net profit of $3,781
c. not offer the discount as it results in a net cost of $781
d. not offer the discount as it results in a net cost of $1,781
e. not offer the discount as it results in a net cost of $17,781

Solution Preview

Please see the response to your posting in attached file.

Question 16
Barneycle's Boat Shop sells 3000 of its glow-in-the-dark boats each year and has fixed order costs of $120 per order. Carrying cost per boat is $150 per year. What is the optimal order quantity for these boats?

a. 69
b. 87
c. 98
d. 133
e. 1200

Optimal order quantity = square root of((2* annual demand* fixed order cost)/charring cost per boat per year)= square root ...

Solution Summary

The solution contains both a narrative explanation as well as the calculations in response to finance-related problems.

Jill's Job Shop buys two parts (Tegdiws and Widgets) for use in its production system from two different suppliers. The parts are needed throughout the entire 52-week year. Tegdiws are used at a relatively constant rate and are ordered whenever the remaining quantity drops to the reorder level. Widgets are ordered from a supplie

How does an increase in the price of widgets affect the: And describe the effects in detail?:
a. Demand for widgets
b. Supply of widgets
c. Demand for woozles if widgets and woozles are substitutes
d. Demand for gadgets if widgets and gadgets are complements

1. Industry supply and demand are given by QD = 1000 - 2P and QS = 3P.
What is the equilibrium price andquantity?
At a price of $100.00, what will the quantity be?
2. The demand equation for the Widget Company has been estimated to be :
Qd= 20,000 + 10 i - 50P + 20 PC
Q=monthly # of widgets sold, I= average mon

XYZ Corporation is a manufacturer of widgets. Over the past several months, it has been selling its widgets for $100 each and unit sales have averaged 5,000 units per month. This month its competitor, ABC, Inc. raised the price of its widgets from $100 to $110. XYZ noted that its unit sales increased by 200 units.
A. What is

"Jill's Job Shop buys two parts (Tegdiws and Widgets) for use in its production system from two different suppliers. The parts are needed throughout the entire 52-week year. Tegdiws are used at a relatively constant rate and are ordered whenever the remaining quantity drops to the reorder level. Widgets are ordered from a suppli

A bagel shop buys each bagel for .08 and sells each bagel for .35. Leftover bagels at the end of they day are purchased by a local soup kitchen for .03 per bagel. The shop owner has observed daily demand (Q), the following probabilities (F(Q)
Q=0, F(Q)= .05
Q=5, F(Q)= .1
Q= 10 F(Q)= .1
Q= 15, F(Q)= .2
Q= 20, F(Q)= .25

Calculate the break-even for a Widget company given the following information:
Sales Price Variable Cost per unit Fixed Costs
Widgets $800 $550 $77,000
Problem 2
Based upon the information needed in problem 1, how many widgets must be produced to earn a profit of $50,000?

Market Structure Problem #1: The Widget Industry:
The Widget industry is perfectly competitive. The lowest point on the long-run average cost curve of each of the identical widget producers is $4 and this minimum point occurs at an output of 1,000 widgets per month. When the optimal scale of a firm's plant is operated to pr

You own a company that manufactures and sells widgets. Your sales for last year were $100,000. Each widget sells for $8.50. The cost of material for each widget is $4.00 and last years labor cost was $285,000.00. The fixed costs for the operation are $185,000. What is the break-even in widgets and dollars.