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OR350 11-6

OR350 11-6 - 1 s=.8 n=log(s/log(2 n=log.8/log(2...

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1) s=.8 n=log(s)/log(2) n=log(.8)/log(2) n= -.3219280949 k=400 hrs z 10 =k(10) n z 10 =400(10) -.3219280949 z 10 =400*.476… z 10 =190.6039477 2) u z logu logz slope=n logk k 1 7815000 0 6.89292 9 - 0.07399242 6.89292 5 7814928 2 7424000 0.30103 6.87063 8 3 7205000 0.47712 1 6.85763 4 4 7053000 0.60206 6.84837 4 z5 6937556 z6 6844594 z7 6766968

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c) selling price (std, hi)=(3.6, 5.8) Profit from standard: Using traditional costing=> (3.6-2.72)*320,000= \$281,600 ABC Costing=> (3.6-2.42)*320,000= \$377,600 Profit from Hi-Grade: Using traditional costing=> (5.8-4.06)*120,000= \$208,800 ABC Costing=> (5.8-4.86)*120,000= \$112,800 Expected Profit Traditional Method: \$281,600 + \$208,800= 490,400 Expected Profit ABC Method: \$377,600 + \$112,800= 490,400

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