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Ludmilka [50]
1 year ago
7

Discuss the optimal method for procuring inputs that have well-defined and measurable quality specifications and require highly

specialized investments. What are the primary advantages and disadvantages of acquiring inputs through this means? Give an example not used in the textbook that uses this method of procurement.
Business
2 answers:
solmaris [256]1 year ago
6 0

Answer:

the optimal method for procuring inputs that have well-defined and measurable quality specifications and require highly specialized investments is <u>Contracting.</u>

Explanation:

Contracting requires writing an agreement that extends the relationship between a buyer and a seller

The key features of contracting includes

  • specialization
  • reduced opportunism
  • avoidance of skimping on specialized investment
  • expensive in complex environments

The primary advantage of using contracting is specialization and the main disadvantage is high cost.

U.S. Shell Oil Company is the United States which is among the largest oil companies in the world is a good example of a company that uses Contracting method for procuring inputs.

son4ous [18]1 year ago
3 0

Answer:

The optimal method for procuring inputs that have well-defined and measurable quality specifications and require highly specialized investments is the contract.

Explanation:

The contract is signed between the seller and the buyer, and establishes formal and legal terms, and agreed responsabilities. The primary advantages are that firms and buyers are allowed to focus in producing and getting what they need as contracts are used for tangible goods and for rendered services, reducing the opportunistic behaviour and underinvestment.

The CONASUPO, mexican government office, signed a contract with the mexican ranch owners to get all their milk production at low prices to feed the thousands of low income families.

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Fizzy Corporation uses the equity method to account for its 25% investment in Organic Juices Company, for which it paid $10 mill
Rasek [7]

Answer:

a. Favorable leaseholds with an 8-year life

Options:

b. Technology rights with a 3-year life

c. Bottler franchise rights with indefinite life

d. Goodwill

Explanation:

We should notice the income recognize is the 25% of the company's income thus, there is no depreciation nor amortization.

a. Favorable leaseholds with an 8-year life

A favorable leaseholds because the market rate changes when performing the acquisition of the 25% would make for this but, will be amortized over an 8 years spawn <em>Hence is guaranteed to not the cause of the 10,000,000 extra as it should decrease the income of 500,000 which is not what happened.</em>

b.- and intangible which isn't recognize in the company's firm can also generate this difference and be eliminate after 3-years thus is a viable option

c.- the franchise right will still be there but, the valuation of them can change. The franchise while it is indefinite It can lose their market value (imagine a franchise of candels after electricity is invented) Thus, it could be or not.

d.- The goodwill could be checked for imparment and eliminated before the 5 years period or not require a journal entry that year.

5 0
2 years ago
Cass &amp; Company has the following data. How many days is the firm's cash conversion cycle? Inventory conversion period = 50 d
Savatey [412]

Answer:

42 days

Explanation:

Given that

Inventory conversion period = 50 days

Average collection period = 17 days

Payable deferral period = 25 days

Now The computation of the cash conversion cycle is shown below:

The cash conversion cycle = Inventory conversion period + Average collection period  -  Payable deferral period

= 50 days + 17 days - 25 days

= 42 days

6 0
1 year ago
Iron triangles have given way to _____ over the years. intergovernmental lobbying issue networks reverse lobbying iron squares
monitta
Iron triangles have given way to INTER-GOVERNMENTAL LOBBYING over the years.

Iron triangles refer to a mutual relationship between three three groups or organizations such as government agencies, interest groups and legislative committees (law makers). It is a policy making relationship in the United States politics. 
8 0
2 years ago
Explain the five steps of the theory of constraints (TOC) process. To what processes might the company in the case study apply T
irga5000 [103]

Explanation:

The theory of constraints (TOC) is a theory whose objective is to identify the most limiting constraint related to a systemic organizational process, that is, to identify the bottleneck that prevents an organization from carrying out its activities effectively and consequently achieving its objectives.

The steps are:

1- Identify: The first step is to identify the most limiting current constraint in the organization.

2- Exploit: In the exploit stage, it means making improvements with the resources available in the identified constraint.

3- Subordinate: In this stage, the review of other organizational activities that may interfere with the identified constraint is carried out, to identify whether there is how to make improvements in the subordinate activities that can guarantee the reduction of the constraint.

4- Elevate: In this stage, actions are implemented to eliminate the constraint if it has not yet been eliminated.

5- Repeat: In the last step, each step of the cycle is monitored so that there is continuous improvement in the elimination of the current constraint or a new constraint, so that the processes are constantly optimized.

TOC is effective in companies that use systemic production processes, as in a manufacture for example, whose stages of the production process are subordinate and one interferes in the quality of the other, which can interfere in the process as a whole.

The theory of constraint offers the continuous improvement of all processes and the elimination of current restrictions and the better identification of possible new restrictions, as well as the best use of organizational resources, which generates for the company greater profitability, less waste and less time delivery, improving the entire organizational process.

6 0
2 years ago
A manager wants to minimize the total cost of the inventory. The annual demand for the wheel is 60,000 wheels, and the firm oper
Ede4ka [16]

Answer:

Check th explanation

Explanation:

2a.

Here, we will have to apply the economic production quantity as we have to identify optimal production quantity to minimize the cost.

Annual Demand D = 60000

Working Days = 240

Daily Demand d= 60000/240 = 250

Production Rate p = 300

Set up cost S = 150

Holding cost H = 3

Economic Production Quantity Q = (2DS/(H*(1-(d/p))))^(1/2)

Q = (2*60000*150/(3*(1-(250/300))))^(1/2)

Q = 6000 units

4 0
2 years ago
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