Outsourcing the component from samina-sci

Assignment Help Finance Basics
Reference no: EM131071823

Assume a division of Hewlett-Packard currently makes 12,000 circuit boards per year used in producing diagnostic electronic instruments at a cost of $34 per board, consisting of variable costs per unit of $24 and fixed costs per unit of $10. Further assume Sanmina-SCI offers to sell Hewlett-Packard the 12,000 circuit boards for $34 each. If Hewlett-Packard accepts this offer, the facilities currently used to make the boards could be rented to one of Hewlett-Packard's suppliers for $46,000 per year. In addition, $6 per unit of the fixed overhead applied to the circuit boards would be totally eliminated.

Calculate the net benefit (cost) to HP of outsourcing the component from Samina-SCI. Use a negative sign with your answer, if appropriate.

Reference no: EM131071823

Questions Cloud

What is the firm price-earnings ratio : Lassiter Industries has annual sales of $328,000 with 8,000 shares of stock outstanding. The firm has a profit margin of 4.5 percent and a price-sales ratio of 1.20. What is the firm's price-earnings ratio?
Develop a c++ based library management system : You have been assigned a task by your school librarian to develop a C++ based library management system that can enable librarians to: Add new books and View books
Senior management for the need for a team to solve a problem : After completing reading assignments, produce three documents (1 page each)- 1) A memo to Senior Management for the need for a team to solve a problem, which also identifies the team roster.
Long position in the futures contract : (a) Calculate the changes in the margin account from daily marking-to-market and the balance of the margin account after the third day. (b) Do the problem again assuming you have a long position in the futures contract.
Outsourcing the component from samina-sci : Calculate the net benefit (cost) to HP of outsourcing the component from Samina-SCI. Use a negative sign with your answer, if appropriate.
Determine the expected inheritance : Given her goal in 2a above and the investment she already has in 2b in addition to her expected inheritance, how much does she need to invest per year (at 9% annual rate of return) beginning a year from now till retirement, in order to reach her r..
Explain the unpredictable well-dressed purchasing manager : Explain The unpredictable well-dressed purchasing manager. The sales practices revealed in the Internal Sales Department.
Stages of the factory production process : Analyse and calculate the average daily capacities (designed, effective and actual) for the two main stages of the factory production process: cleaning/blanching and freezing, measured by outputs either in dirty or frozen tonnes whichever is appli..
What are the potential pressures for chris to commit fraud : What are the potential pressures for Chris to commit fraud? What are the potential opportunities for Chris to commit fraud? What potential rationalizations could Chris use to commit fraud?

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the nominal rate

If the effective rate is 12%. What is the nominal rate if compounding is daily. Do not enter the symbol % in your answer. Simply enter the answer in percentages rounded off to two decimal points.

  Which company has an absolute borrowing advantage

A Brazilian Software company (KondZilla) plans to expand its business to the U.S. market and requires USD$15 million to fund the expansion. The Brazilian company faces the following borrowing opportunities:

  Explain what long position in the stock

Explain what long position in the stock is necessary to hedge a short call option when the strike price is $32 and provide the number of shares purchased as a percentage of the number of options that have been sold

  Amortization expense

Dade buy a patent on January 1, 2003 for $120,000. The patent had a remaining useful life of ten years at that date. In January 2004, Dade successfully defends patent at a cost of $54,000,

  Compute the speculative premium

The Preston Toy Co has warrants outstanding that permit the holder to purchase a share of stock for $22. The common stock is currently selling for $28,

  What is value of net working capital to total assets ratio

Accounts payable of $2,014, inventory of $6,850, cash of $1,263, fixed assets of $8,400, accounts receivable of $3,807, and long-term debt of $4,200. What is the value of the net working capital to total assets ratio?

  At what discount rate would the company be indifferent

At what discount rate would the company be indifferent between these two projects?

  Devaluation on its hardware

The firm gives devaluation on its hardware @ 10% for every annum on unique expense on 31st March consistently.

  These bonds make annual payments and mature 13 years from

you bought one of great white shark repellant co.s 9 percent coupon bonds one year ago for 790. these bonds make annual

  Calculate the incremental tax savings

A company is planning the replacement of an asset bought three years ago at a cost of $100,000. Under MACRS, the asset was in five year recovery period class.

  Make a income statement pro forma

Make a income statement pro forma

  Decisions of executives within the firm

1. Discuss the differences, similarities, and ties between finance and accounting. 2. Discuss the relationship between finance and economics. 3. How does the activity of investors in financial markets affect the decisions of executives within the fir..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd