hw_solution_1

hw_solution_1 - Important Note For your own reference...

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Important Note: For your own reference, feedback, review purposes; the following answers (a solution/ an opinion, Not as an absolute solution) to the assigned chapter questions are provided. Chapter 1 1-14: It is important that costs are minimized in the supply chain. Because it is cheaper for California Chips to carry the inventory, the resolution should result in California Chips carrying the inventory. You might suggest that the two firms share the inventory savings through price discounts or other contractual agreement. 1-15: a. Differential costs are costs that would change, which are the labor costs in this situation. Other costs would presumably not be affected by the change in labor. Other issues include the quality and dependability of the new approach. Differential costs next year are $0.07 (= $0.20 – $0.13) calculated as follows: Labor Cost Old Method New Method Next year $0.20 $0.13 [ = (1 – .35) x $0.20] b. Management would use the information to help decide whether to use the
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This note was uploaded on 10/29/2009 for the course ACC 066 taught by Professor Kwak during the Spring '08 term at DeAnza College.

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hw_solution_1 - Important Note For your own reference...

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