67. According to the theory of constraints, bottlenecks can be found in A. The manufacturing processB. The distribution processC. The marketD.All of the aboveAACSB: AnalyticAICPA BB: Critical ThinkingDifficulty: EasyHilton - Chapter 12 #67Learning Objective: 7Use the following to answer questions 68-69:Melnick Enterprises manufactures two products, boat wax and car wax, in two departments, the Mixing Department and the Packaging Department. The Mixing Department has 800 hours per month available, and the Packaging Department has 1,200 hours per month available. Production of the two products cannot exceed 36,000 pounds. Data on the two products follow:Hilton - Chapter 1268. (Appendix B. The objective function for the linear program Melnick would use to determine the optimal monthly production of each wax would be: AACSB: AnalyticAICPA BB: Critical ThinkingDifficulty: MediumHilton - Chapter 12 #68Learning Objective: 8
69. (Appendix B. The mixing constraint for the Melnick linear program would be: AACSB: AnalyticAICPA BB: Critical ThinkingDifficulty: MediumHilton - Chapter 12 #69Learning Objective: 870. What is a financial model? Give an example of one. A financial model is a simulation of reality. It allows an organization to test the interaction of economic variables. Such models require that a company's operating and financial relationships be determined and mathematically integrated through a series of equations with other factors that affect company decisions. These relationships may include the cost of goods sold percentage, the time to collect accounts receivables, inventory turnover ratios, and the relative sales mix. The model is then processed to allow the user to determine the effect of different variables on the business. For example, we could determine the effect on the company's financial statements from a change in credit policy. These models allow a company to study the financial impact of a business decision before the decision is made. An example of a financial model is the cost-volume-profit (CVP) model. This model summarizes the effects of volume changes on a company's costs, revenues, and profit. This analysis can be extended to cover the impact on profit of changes in selling prices, costs, tax rates, and the sales mix. The CVP model can be used to answer questions such as, "Should we drop a product line or business unit?" and "Should we produce a particular good internally or acquire it from outside the company?" AACSB: Reflective ThinkingAICPA BB: Critical ThinkingDifficulty: MediumHilton - Chapter 12 #70Learning Objective: 1
71. Yoni Corporation manufactures skateboards and is in the process of preparing next year's budget. The pro forma income statement for the current year is presented below:Compute the following:(1) What is contribution margin per unit? __________(2) What is the breakeven point in units? __________
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