subject
Business, 05.05.2020 06:06 deshawnmichaelosbqs9

Valmont Company has developed a new industrial piece of equipment called the XP-200. The company is considering two methods of establishing a selling price for the XP-200—absorption cost-plus pricing and value-based pricing. Valmont’s cost accounting system reports an absorption unit product cost for XP-200 of $10,100. Its markup percentage on absorption cost is 85%. The company’s marketing managers have expressed concerns about the use of absorption cost-plus pricing because it seems to overlook the fact that the XP-200 offers superior performance relative to the comparable piece of equipment sold by Valmont’s primary competitor. More specifically, the XP-200 can be used for 26,000 hours before replacement. It only requires $2,700 of preventive maintenance during its useful life and it consumes $205 of electricity per 1,300 hours used. These figures compare favorably to the competing piece of equipment that sells for $26,000, needs to be replaced after 13,000 hours of use, requires $5,400 of preventive maintenance during its useful life, and consumes $242 of electricity per 1,300 hours used. Required: 1. If Valmont uses absorption cost-plus pricing, what price will it establish for the XP-200? 2. What is XP-200’s economic value to the customer (EVC) over its 26,000-hour life? 3. If Valmont uses value-based pricing, what range of possible prices should it consider when setting a price for the XP-200?

ansver
Answers: 2

Other questions on the subject: Business

image
Business, 22.06.2019 03:00, nyceastcoast
How does having a flexible mind you become a better employee? a. it you become more honest toward work. b. it you become a team player. c. it you learn new things that will better your performance. d. it you to finish your work on time. e. it you reach work on time
Answers: 1
image
Business, 22.06.2019 15:20, Geo777
Table 1. shows the expected demand for the dvd at different suggested donation levels, and they can act as a single-price monopolist if they choose to. thereceipts will be used to fund gstcg supplies for their data collection and conservation work. at the end of each sea turtle nesting season, any excess funds are donated by the gstcg to a local non-profit sea turtle research and rehabilitation facility. table 1 suggested anticipated total marginal profit donation per number of dvd revenue revenue dvd request requests $19.00 0 $15.00 2 $9.50 4 $7.75 10 $3.00 15 $0.00 20 a. complete table 1 by computing the total revenue, marginal revenue, and profit columns. b. the president wants the gstcg to provide videos to generate the most possible donations (total revenue). what price, if any, is the president of the gstcg favoring and how many people will receive the dvd if this becomes the price of the suggested donation? explain your answer. c. the education outreach committee wants the gstcg to provide videos to the highest possible number of people. what price, if any, is the educational outreach committee favoring and how many people will receive the dvd if this becomes the price of the suggested donation? explain your answer. d. the treasurer of the gstcg wants the dvd program to be as efficient as possible so that the marginal revenue equals marginal cost. what price, if any, is the treasurer favoring and how many people will receive the dvd if this becomes the price of the suggested donation? explain your answer. e. the fundraising committee wants the dvd program to generate as much profit in donations as possible. what price, if any, is the fundraising committee favoring and how many people will receive the dvd if this becomes the price of the suggested donation? explain your answer.
Answers: 3
image
Business, 22.06.2019 17:00, allofthosefruit
Jillian wants to plan her finances because she wants to create and maintain her tax and credit history. she also wants to chart out all of her financial transactions for the past federal fiscal year. what duration should jillian consider to calculate her finances? from (march or january )to (december or april)?
Answers: 1
image
Business, 22.06.2019 20:30, smarty5187
(30 total points) suppose a firm’s production function is given by q = l1/2*k1/2. the marginal product of labor and the marginal product of capital are given by: mpl = 1/ 2 1/ 2 2l k , and mpk = 1/ 2 1/ 2 2k l . a) (12 points) if the price of labor is w = 48, and the price of capital is r = 12, how much labor and capital should the firm hire in order to minimize the cost of production if the firm wants to produce output q = 18?
Answers: 1
You know the right answer?
Valmont Company has developed a new industrial piece of equipment called the XP-200. The company is...

Questions in other subjects: