...CASE ANALYSIS FinePrint Company is a printing company which specializes in color printing brochures. The company is located in Charlottesville, Virginia. Its main consumers are mainly from central Virginia, with some in southwestern Virginia and Chesapeake Bay area. The owner of FinePrint Company, John Johnson, is presented with an opportunity to expand his company's capacity. In order to do this he must consider whether to outsource some of his printing to another company in Charlottesville, Virginia named SmallPrint Shop. Currently, FinePrint is running "at around" full capacity of 150,000 brochures a month. Problem incurred is FinePrint does not give us the actual amount of full capacity. So we must assume FinePrint still has available space within its facility to produce more products. The owner, Mr. John Johnson runs the company himself. In addition, he hired one sales representative and one printing-press operator. He also hired temporary labor to help when assistance is needed. SmallPrint has offered FinePrint a monthly amount of 30,000 brochures at a cost of $8 per 100 brochures. SmallPrint had performed a high quality of work and their company is dependable. This capacity is available from SmallPrint because they had lost a major customer, after investing company resources into a small printing press they used specifically for that customer’s need. SmallPrint offers FinePrint a low cost in order to keep their press going. Mr. Johnson thinks it is...
Words: 2086 - Pages: 9
...Zack Aldridge Cost Accounting May 2015 FinePrint Company In this scenario, you have John Johnson. Johnson is the owner of a well-known high quality printing company in Central Virginia. Johnson performs most of his business around the central Virginia area but will occasionally expand outside of that area to do some business. John Johnson has recently been faced with two offers. The first offer was one made by a friend of his, who owns a small printing company, which is also in Virginia. She had called Johnson to see if he could do a special printing job for her. The second offer he had was from another small time printing business owner who offered to Johnson to help work for FinePrint for pretty cheap. Johnson’s friend, Abbie Jenkins, wanted to work a deal with Johnson where she would pay him 10 dollars for every 100 brochures he printed for her. From the moment he got that offer, he knew that was pretty low but told Abbie he would consider. In the second offer, Ernst had offered to help Johnson out by printing brochures for a low price. The offer of 8 dollars for every 100 brochures didn’t sound too bad to Johnson. After a first glance at both if the offers, it would seem to me that the second offer would be the best option. Even Johnson initially even thought that sounded like a more attractive option. After the calculations, it is figured to be that accepting the first offer on the special order would be the more attractive option. The net income...
Words: 349 - Pages: 2
...1. Assume FinePrint is currently operating at full capacity of 150,000 brochures per month, should the special order from Abbie Jenkins be accepted? [In answering, assume Ernest Bradley has not yet made his offer to handle 30,000 brochures and that FinePrint cannot increase capacity beyond 150,000 brochures per month.] FinePrint should not accept the special order from Abbie Jenkins. Since, John Johnson’s goal is to maximize profits, FinePrint would only accept the special order if it increased their profits. An analysis was conducted to identify the company’s current revenues, costs and profits in its current state, and also if the special order was accepted (See Exhibit A). At full capacity, FinePrint has revenues of $25,500, costs of $22,500 which equates to $3,000 in profit a month. By accepting the special order, the total costs are decreased by $250 because Johnson saves $1 on every 100 brochures in the special order (no sales commission). The revenues generated from the special order decrease total revenues from $25,500 to $23,750 because FinePrint will only receive $10 per 100 brochures. This means the profit from executing the special order decrease from $3,000 to $1,500. This reduction in $1,500 in profits alone would indicate that FinePrint should not accept the special order. More importantly than short-term profits, however, is the fact that this deal does not make good business sense for FinePrint. Since FinePrint is operating at full capacity, in order...
Words: 1157 - Pages: 5
...Fineprint Company (Abridged) Q1a Net income is calculated to determine whether to accept the special order from Abbie Jenkins. Looking at the normal operation, net income for selling 150,000 brochures is $3,000. Due to FinePrint operating capacity capped at 150,000 per month, FinePrint have to give out equivalent amount of business (25,000 brochures) to produce for Abbie Jenkins. FinePrint net income will drop 50% from $3,000 to $1,500 if John accept Abbie Jenkins offer. Hence, FinePrint should turn down the offer. Standard order Selling price = $17.00 per 100 brochures $0.17 per brochure Selling units = 150,000 Total Per Unit Revenue $25,500.00 $0.17 Less : Variable expenses $10,500.00 $0.07 Contribution margin $15,000.00 $0.10 Less: fixed expenses $12,000.00 Net income $3,000.00 Special & standard order mix Special order - 25,000 brochures Selling price $10.00 per 100 brochures $0.10 per brochure Selling units 25,000 Variable expenses per unit $0.06 (Less $1 for per 100 brochures for SR) Total Per Unit Revenue $2,500.00 $0.10 Less : Variable expenses $1,500.00 $0.06 Contribution margin $1,000.00 $0.04 Fineprint Company (Abridged) Q1a con’t Standard order - 125,000 brochures Selling price = $17.00 per 100 brochures $0.17 per brochure Selling units = 125,000 Total Per Unit Revenue $21,250.00 $0.17 Less : Variable...
Words: 628 - Pages: 3
...FinePrint Company Case Analysis by Da Zhang Questions: 1. If FinePrint is currently operating at full capacity of 150,000 brochures per month, should the special order from Abbie Jenkins be accepted? [In answering, assume Ernest Bradley has not yet made his offer to handle 30,000 brochures.] John should not take this special order because filling any special order at full capacity at reduced price will fail to satisfy customers who pay full price. Computation of using 25,000 capacity to produce normal brochures: Revenue-Cost=1500*17-22500=25500-22500=3000 Computation of using 25,000 capacity to produce special order: Revenue-Cost=(1250*17+250*10)-(22500-250)=(21250+2500)-22250=1500 Apparently, the profit generated from special order is much less than from normal brochures, thus Fineprint should not take the offer. 2. Assume that Ernest Bradley has made his offer to handle 30,000 brochures. a. Assuming FinePrint is operating at capacity of 150,000 brochures and there is no special order opportunity from Abbie Jenkins, should FinePrint outsource 30,000 brochures to Ernest? Why or why not? Fineprint should not outsource 30,000 brochures to Ernest because the cost that Fineprint produce 30,000 by itself is less than the cost of outsourcing when the revenues remain unchanged. Cost of outsourcing 30,000 brochures=300*8=2400 Cost of self-production of 30,000 brochures=30,000*0.04+(30,000*0.01)*3=1200+900=2100 Apparently, variable cost $2100 is less than outsourcing...
Words: 352 - Pages: 2
...1. FinePrint currently is operating at around full capacity: 150,000 brochures. Should Johnson accept the special order? See Answer Below Regular Ops Difference Special Order 25,000 Option 1 Option 2 Option 1 Option 2 Revenues $25,500 $23,750 -$1,750 $4,250 $2,500 Variable Cost Direct Material 6,000 6,000 1,000 1,000 Direct Labor 1,500 1,500 250 250 Manufacturing Overhead 1,500 1,500 250 250 Marketing 1,500 1,250 250 250 0 Total VC 10,500 10,250 250 1,750 1,000 Contribution Margin 15,000 13,500 -1,500 2,500 1,000 Fixed Costs Direct labor 3,000 3,000 Manufacturing Overhead 3,375 3,375 Marketing 1,875 1,875 Corporate 3,750 3,750 Total FC 12,000 12,000 -1500 No, the special order should not be accepted. It is clear that the special order would negatively impact revenue by $1500. 2. Assuming FinePrint is operating at capacity of 150,000 brochures and there is no special order from Abbie, should FinePrint outsource 30,000 brochures to Ernest? Why or why not? Regular Ops Difference Outsourcing 30,000 Option 1 Option 2 Option 1 Option 2 ...
Words: 536 - Pages: 3
...44 Plays for 44 Presidents TA: Vicki Hoskins Wed 12:00 GROUPB Student: Shenghui Xu netID xu70 I had always thought that I would get bored watching 44 Plays for 44 Presidents since it was a historical play. But it turned out that I was wrong. It is one of the most interesting plays I have ever seen. I was amazed by the playwright’s compression skill of putting the history of forty-four American candidates into a two hour play and adding intensity to the play at the same time. The play is obviously presentational because actors act from the outside, living a life of a president can’t be acted from one’s own experience (which is representational by definition). For example, Sidney Germaine, acting as President Kennedy didn’t have the experience of delivering a moon speech and having all those grand expectation about sending American astronauts to the moon. But he could still portray the president’s strong love and determination of his moon dream by stretching the purple ball to make it bigger and bigger. The key of drama is the essence of conflict. People may have different interpretations regarding the main conflict of the play. As I see it, the key conflict might be that presidents are ultimately “human” and they are tasked with such monumental responsibility, and sometimes our inability to understand that could also be what the conflict that the play tries to explore. I remember one scene when Preston Brant, acting as Barack Obama managed to jump over two ropes which rotate...
Words: 467 - Pages: 2
...incurred at $20,750 with the additional increase of 25,000 brochures the total cost would increase by $1,750 to a total of $22,500 as seen in the table above. Sales would also increase and allow for a $750 increase in net income if the special order was accepted. [pic] 3. Go back to the original information in Exhibit 1. Assume current sales volume is 150,000 and that FinePrint is willing to incur the additional fixed costs to operate at 200,000 capacity. Should we accept Jenkins order for 25,000 brochures? What is the change (increase or decrease) in net income if we choose to accept the special order? If FinePrint chooses to incur the additional fixed costs to operate at 200,000 capacity they should not accept the Jenkins order for 25,000 brochures. The increase of 25,000 brochures increases fixed expenses and the additional sales does not make up for the increased expenditures. Net income would decrease by $825 as shown in the table below. [pic] 4. Go back to the original information in Exhibit 1. Assume current sales volume is 150,000 and the FinePrint is NOT willing to incur the additional fixed costs to operate at...
Words: 816 - Pages: 4
...Erfolgsfaktoren interkultureller Strategischer Allianzen - am Beispiel von bilateralen Kooperationen zwischen deutschen, franzo sischen und japanischen Automobilunternehmen - INAUGURALDISSERTATION zur Erlangung des Grades eines Doktors der Wirtschaftswissenschaft des - Fachbereichs Wirtschaftswissenschaft der Gerhard-Mercator-Universita t Gesamthochschule Duisburg Vorgelegt von Dipl.-O k. Carola Krieger 46537 Dinslaken 2001 PDF wurde mit FinePrint pdfFactory-Prüfversion erstellt.http://www.context-gmbh.de II Inhaltsverzeichnis Abbildungsverzeichnis...................................................................................... VI Abku rzungsverzeichnis ..................................................................................... IX I. Fragestellung.................................................................................................... 1 II. Forschungsstand und Vorgehensweise ........................................................... 5 III. Aufbau der Arbeit.......................................................................................... 8 1. Strategische Allianzen................................................................................... 11 1.1 Definition der Strategischen Allianz und ihrer charakteristischen Merkmale ........................................................................................................................... 14 1.2 Herleitung des theoretischen Bezugsrahmens.........................
Words: 131050 - Pages: 525
...The Battle R e ta i l for What is FDI in retail? Retail battle: It’s finally about politics and numbers, not FDI FDI in retail: Why it works for everyone FDI fineprint: Easing FDI doesn’t ease problems plaguing retail 04 06 08 The verdict FDI in retail: Why the politicians are illogical, and have got it wrong Don’t pity the kirana guy, he knows how to fight back Economy, not kirana shops, is biggest loser in retail FDI debate Why the kirana dukan doesn’t care about Big Brother 11 13 15 17 All sides of the debate GOVERNMENT FDI in retail ‘distinct and different’: Sharma Out on a limb: Govt says FDI in retail will ‘immensely benefit farmers’ Reader debate: Is FDI in retail bane or boon? PUBLIC India Inc appeals political parties to support FDI in retail India Inc divided over FDI in multi-brand retail INDUSTRY FDI in retail: Opposition, allies term it anti-people Will not allow Parliament to function until FDI in retail is withdrawn: NDA OPPOSITION Why some farmers are relieved to be dealing with Wal-Mart Farmers Retail FDI: The merits are over-hyped, say academics Academics Cong meets over FDI in retail: Is a rollback on the cards? Will FDI last? FDI nod given, global retailers wait for more clarity The world is waiting FDI in retail What is ? Retail battle: It’s finally about politics and numbers, not FDI he Congress is hell-bent on pushing through its proposal for foreign direct investment (FDI)...
Words: 12610 - Pages: 51
