1. Wehrs Corporation has received a request for a special order of 9,100 units of product K19 for $46.60 each. The normal selling price of this product is $51.70 each, but the units would need to be modified slightly for the customer. The normal unit product cost of product K19 is computed as follows:

Direct materials	$	17.40
Direct labor		6.70
Variable manufacturing overhead		3.90
Fixed manufacturing overhead		6.80
Unit product cost	$	34.80

Direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like some modifications made to product K19 that would increase the variable costs by $6.30 per unit and that would require a one-time investment of $46,100 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order.

Required:

Determine the effect on the company's total net operating income of accepting the special order.

2. Fyodor Corporation has a Parts Division that does work for other Divisions in the company as well as for outside customers. The company's Machine Division has asked the Parts Division to provide it with 8,000 special parts each year. The special parts would require $31 per unit in variable production costs.

The Machine Division has a bid from an outside supplier for the special parts at $44.70 per unit. In order to have time and space to produce the special part, the Parts Division would have to cut back production of another part-the QR4 that it presently is producing. The QR4 sells for $60 per unit, and requires $30 per unit in variable production costs. Packaging and shipping costs of the QR4 are $2 per unit. Packaging and shipping costs for the new special part would be only $0.50 per unit. The Parts Division is now producing and selling 40,000 units of the QR4 each year. Production and sales of the QR4 would drop by 5% if the new special part is produced for the Machine Division.

Required:

a. What is the range of transfer prices within which both the Divisions' profits would increase as a result of agreeing to the transfer of 8,000 special parts per year from the Parts Division to the Machine Division? (Round your final answers to 2 decimal places.)

b. Is it in the best interests of Fyodor Corporation for this transfer to take place? yes or no?

3. Schurz Corporation's management reports that its average delivery cycle time is 28 days, its average throughput time is 15.0 days, its manufacturing cycle efficiency (MCE) is 0.24, its average move time is 0.4 day, and its average queue time is 5.0 days.

Required:

a. What is the wait time? (Round your answer to 1 decimal place.)

b. What is the process time? (Round your answer to 1 decimal place.)

c. What is the inspection time? (Round your intermediate calculations and final answer to 1 decimal place.)