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Identify whether each of the following transactions involves spot exchange, contract, or vertical integration. For the last item if the contract length is optimal or suboptimal.
a. Elasticities R Us, a local econometric forecasting firm, purchases office equipment from Staples.
b. Exxon-Mobil uses the oil extracted from its wells to produce raw polypropylene, a type of plastic.
c. Arcadia University contracts with Marriott for housekeeping services and has a legal obligation to purchase these services for the next 3 years.
d. Wavy Wall Construction - a homebuilding contractor - purchases drywall from the local Home Depot.
e. As a manager of the WeDoWell Corporation, you have negotiated with several vendors and are on the verge of signing an eight-year contract with Bolts Enterprises. Under the contract, they would ship to you 2,000 titanium bolts per month at a price of $1,000 per bolt. Your assistant has just brought you an article from a trade publication that indicates another company has developed a new technology that reduces the cost of producing the titanium bolts. How would this information affect the optimal length of your contract with Bolts Enterprises? Explain.
How marginal costing would improve the problems faced in absorption costing on manipulation of profits.
full explaination with diagram
What is traditional costing In traditional costing overheads are first related to cost centers (production and service centres) and then to cost object, i.e. production. ABC o
Explain the categories of The activity cost drivers The activity cost drivers can broadly be classified into following three categories: 1) Transaction drivers: for exampl
Compute the value of share of a company? A company paid dividend amounting to Rs. 0.75 each share during the last year. The company is supposed to pay Rs. 2.00 per share throug
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ARR gives a fast estimate of a project's value over its useful life. ARR is derived by determining profits before taxes and interest. ARR is an accounting technique used fo
Definition of Activities based costing Activity based costing is a system that focuses on activities as the fundamental cost objects and uses the costs of these activities as b
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