The following is an excerpt from a conversation between Mark Loomis and Krista Huff. Mark is debating whether to buy a stereo system from Tru-Sound Systems, a locally owned electronics store, or Wholesale Stereo, an online electronics company. Mark: Krista, I don't know what to do about buying my new stereo. Krista: What's the problem? Mark: Well, I can buy it locally at Tru-Sound Systems for $1,175.00. However, Wholesale Stereo has the same system listed for $1,200.00. Krista: What's the big deal? Buy it from Tru-Sound Systems.
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- The following is an excerpt from a conversation between Mark Loomis and Krista Huff. Mark is debating whether to buy a stereo system from Tru-Sound Systems, a locally owned electronics store, or Wholesale Stereo, an online electronics company.Mark: Krista, I don’t know what to do about buying my new stereo.Krista: What’s the problem?Mark: Well, I can buy it locally at Tru-Sound Systems for $1,175.00. However, Wholesale Stereo has the same system listed for $1,200.00.Krista: What’s the big deal? Buy it from Tru-Sound Systems.Mark: It’s not quite that simple. Wholesale Stereo charges $49.99 for shipping and handling. If I have Wholesale Stereo send it next-day air, it’ll cost $89.99 for shipping and handling.Krista: So?Mark: But, that’s not all. Tru-Sound Systems will give an additional 2% discount if I pay cash. Otherwise, they will let me use my VISA, or I can pay it off in three monthly installments. In addition, if I buy it from Tru-SoundSystems, I have to pay 9% sales tax. I won’t…Susan plans on selling her mugs. She has created two scenarios and wants to know which will provide her the better profit. In order to help her figure this out, she asks you to figure out when the two options are the same. Option 1: Sells at a local store. It costs her $445 for a shelf at the store, but it's in an upscale neighborhood that gets lots of foot traffic so she can sell the mugs for $30 in profit. Option 2: Sell at the local farmers market. It costs her $100 for a booth, but busy can vary quite a bit. She figures she call sell the mugs for a $7 profit. When are the two options the same?: Jim and Jane would like to purchase a home theatre system for their newly renovated home. After e... Jim and Jane would like to purchase a home theatre system for their newly renovated home. After extensive research online and visiting at a few local electronics stores, they would like to purchase the newly released speaker package for $3,600. (provide breif and step by step solution for the following problem also provide the formulas) (a) Mega Electronics are currently offering a deal of 12 equal monthly repayments with no interest charges. If Mega Electronics values money at 8.4% per year compounded monthly, what cash amount should Mega Electronics be willing to accept instead of the no-interest plan? (b) Alternatively,GrandGuy soffers the same no-interest planbut require a10% deposit and an establishment fee of $30 both of which are payable immediately. GrandGuys also charges an account keeping fee of $2.95 per month due with each payment. What cash amount should GrandGuys be…
- Kurt and Sam are planning to open a small shop selling lunch boxes, which they will prepare on the premises. After experimenting for some weeks Kurt and Sam have arrived at two possible lunch box sets, which they think will be popular: Lunch Box A and Lunch Box B. As they can only prepare one lunch box on the premises, they need to decide, which one to choose. a) What is the break-even point for both options? b) What profit would the expected sales of each option achieve? c) How many boxes of each option would Kurt and Sam have to sell if they wanted to achieve a profit of £800. d) Kurt and Sam are considering a selling price increase of 10% for both lunch box options. How many boxes of each option would they have to sell to achieve a target profit of £900? e)Based on the information calculated above explain, which option Kurt and Sam should choose: Lunch Box A or Lunch Box B. You should also consider if the information you calculated is sufficient for making an informed decision.A new company down the street is thinking about buying a radio system. Their purchasing agent, Harry, is my next-door neighbor. Harry asks me if he can "borrow" a MR-808BC from me to test out. I don't like to do that, but Harry offers me $1,200 cash to use the Broadcaster for two months. I take his $1,200 cash and loan him the MR-808BC. I deposit the $1,200 in the bank. I have been interested in the possibility of going into the rental business. This is a good opportunity to see how it will work and what results it may produce. ***For this transaction, you may do journal entries to accomplish all of the accounting necessary. Be mindful of all of the accounts impacted by this transaction. What is the JE's for the scenario above? Or is this ignored for business purposes?A refinisher of antiques named Constance has been so successful with her small business that she is planning to expand her shop. She is going to start enlarging her shop by purchasing the following equipment.(a) What would be the net cost to Constance to obtain this equipment? Assume that she can trade the old equipment in for 15% of its original cost. Assume there has been no inflation in equipment prices. (b) Suggest a green engineering approach to constance for disposing of the solvents and lacquers used in her business.
- I.M. Aruban has a sandwich shop in a downtown business district. Several ofhis customers have said that they would purchase from his shop more oftenif he offered a delivery service. I.M. is considering establishing a deliveryservice to meet the needs of his market. He believes that he will have to purchasea fax machine, install a new phone line for the fax machine, purchasea delivery van, and hire at least one delivery person. I.M. asks your advice indetermining whether he should take on the delivery service venture.a. What steps would you recommend that I.M. use in reaching a profitabledecision?b. Explain to I.M. what each step involves.Adriana Alvarado has decided to purchase a personal computer. She has narrowed the choices to two: Drantex and Confiar. Both brands have the same processing speed, 6.4 gigabytes of hard-disk capacity, two USB ports, a DVD drive, and each comes with the same basic software support package. Both come from mail-order companies with good reputations. The selling price for each is identical. After some review, Adriana discovers that the cost of operating and maintaining Drantex over a three-year period is estimated to be $300. For Confiar, the operating and maintenance cost is $600. The sales agent for Drantex emphasized the lower operating and maintenance costs. The agent for Confiar, however, emphasized the service reputation of the product and the faster delivery time (Confiar can be purchased and delivered one week sooner than Drantex). Based on all the information, Adriana has decided to buy Confiar. Required: 1 What is the total product purchased by Adriana? 2. How does the strategic…Suppose that you get excited about getting into rock climbing and spend $200 on new gear. However, after a weekend of trying out your new sport you decide it just isn't for you. Turns out, gear shops don't take used climbing gear back. In fact, it is hard to sell used gear too. You decide to sell it online to whoever is willing to give you the best offer. If it would cost you $20 to ship the gear to someone, what is the least you would accept for the gear? A. $20 because the $200 is sunk. B. $200 because that is what you spent on the gear. C. $220 because that is the cost of the gear and the cost of getting it to the buyer. D. None of the above.
- Assume you are in the market for a luxury car. You encounter your salesperson “Billy”, who is excited to see you and help you make this important purchase. You have not decided on a new or used car at this point. Billy recommends a used car that is currently available on the lot at his dealership. You also saw a comparable model on Cars.com that was brand new at another dealership that is an hour away. As you are sitting at Billy’s desk, he offers you a nice cold beverage and a snack. Although you have indicated that you may also like to go see the other car, Billy recommends running your credit to see how low of an interest rate he can get you. This seems to take some time, and at this point 2 hours has gone by. After running your credit, Billy further recommends that you speak with the finance manager about additional accessories and after-market options available. Now 4 hours has gone by and you communicate that although everything sounds really good about the car, you are concerned…Maria Rojas is considering the possibility of opening a small dress shop on Fairbanks Avenue, a few blocks from the university. She has located a good mall that attracts students. Her options are to open a small shop, a medium-sized shop, or no shop at all. The market for a dress shop can be good, average, or bad. The probabilities for these three possibilities are 0.2 for a good market, 0.5 for an average market, and 0.3 for a bad market. The net profit or loss for the medium-sized and small shops for the various market conditions are given in the following table. Building no shop at all yields no loss and no gain. a. What do you recommend? b. Calculate the EVPI. c. Develop the opportunity loss table for this situation. What decisions would be made using the mini- max regret criterion and the minimum EOL criterion? ALTERNATIVE Good Market Average Market Bad Market Small shop 75,000 25,000 -40,000 Medium sized shop 100,000 35,000 -60,000 No shop MARKET 0 0 0Adriana Alvarado has decided to purchase a personal computer. She has narrowed the choices to two: Drantex and Confiar. Both brands have the same processing speed, 6.4 gigabytes of hard-disk capacity, two USB ports, and a DVDRW drive, and each comes with the same basic software support package. Both come from mail-order companies with good reputations. The selling price for each is identical. After some review, Adriana discovers that the cost of operating and maintaining Drantex over a 3-year period is estimated to be $300. For Confiar, the operating and maintenance cost is $600. The sales agent for Drantex emphasized the lower operating and maintenance costs. The agent for Confiar, however, emphasized the service reputation of the product and the faster delivery time (Confiar can be purchased and delivered 1 week sooner than Drantex). Based on all the information, Adriana has decided to buy Confiar. CONCEPTUAL CONNECTION Suppose that Adriana’s decision was prompted mostly by the…