Question - G3: Relevant Costs; Pricing Jenco Incorporated's...

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G3: Relevant Costs; Pricing Jenco Incorporated's only product is a combination fertilizer-weed killer called Fertikil. Fertikil is sold nationwide through normal marketing channels to retail nurseries and garden stores. Taylor Nursery plans to sell a similar fertilizer weed killer compound through its regional nursery chain under its own private label. Taylor does not have manufacturing facilities of its own, so it has asked Jenco (and several other companies) to submit a bid for manufacturing and delivering a 25,000 pound order of the private brand compound to Taylor. While the chemical composition of the Taylor compound differs from that of Fertikil, the manufacturing processes are very similar. The Taylor compound would be produced in 1.000 pound lots. Each lot would require 30 direct labor-hours and the following chemicals: Chemicals Quantity in Pounds CW-3 400 JX-6 300 MZ-8 200 BE-7 100 The first three chemicals (CW-3, JX-6, and MZ-8) are all used in the production of Fertikil. BE-7 was used in another compound that Jenco discontinued several months ago. The
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Question - G3: Relevant Costs; Pricing Jenco Incorporated's...

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