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1. 2. The following Information applies to the questions displayed below Kinnear Plastics manufactures various components for the alrcraft and marine Industry. Kinnear buys plastic
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The following Information applies to the questions displayed below Kinnear Plastics manufactures various components for the alrcraft and marine Industry. Kinnear buys plastic from two vendors: Tappan Corporation and Hll Enterprises. Kinnear chooses the vendor based on price. Once the plastic is recelved, It Is Inspected to ensure that It is suitable for production. Plastic that Is deemed unsultable Is disposed of The controller at Kinnear collected the following information on purchases for the past year appan Hill 3,500 6,500 Total purchases (tons) Plastic discarded 105 325 The purchasing manager has just recelved bids on an order for 240 tons of plastic from both Tappan and Hill. Tappan bld $1,940 and Hill bld $1,938 per ton. Required 1-a. Assume that the average quality, measured by the amounts discarded from the two companies, will continue as in the past. What is the effective cost per ton for both Tappan and Hill? (Do not round intermediate calculations.) Tappan Hill Effective cost per ton Required a. Assume all else remains the same. What bid by Tappan would make Kinnear indifferent betweern buying from Tappan or Hill?(Do not round intermediate calculations. Round your answer to 2 decimal places.) BidStep by Step Solution
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