Identify and describe the primary, support, and general management processes needed to execute a customer order at Zappos.
The Engine Guys produces specialized engines for "snow climber buses. The company's normal monthly production volume is 9,000 engines, whereas its monthly production capacity is 18,000 engines. The current selling price per engine is 51,300. The cost per unit of manufacturing and marketing the engines at the normal volume is as follows: Costs per Unit for Engines $ 100 200 34 Manufacturing costs Direct materials Direct labour Variable overhead Fixed overhead Subtotal Marketing costs: Variable 5 558 $ 65 Subtotal Total unit cost $ 766 Required: 1-a. The Provincial Bus Company wishes to purchase 740 engines in October. The bus company is willing to pay a fixed fee of $1,080,000 and reimburse The Engine Guys for all manufacturing costs incurred to manufacture 740 motors. October is a busy month for The Engine Guys, and there are sufficient orders to operate at 100% capacity utilization. There will be no variable marketing costs on this government contract. Compute the incremental benefit of the contract. 1-b. Indicate whether the Provincial Bus Company's contract should be accepted Yes NO 2-a. An outside contractor is willing to supply 4,500 engines at a price of 5624 per unit. If the offer is accepted, the company will make 4,500 engines in-house and buy 4.500 engines from the contractor. The company's fixed manufacturing costs will decline by 20% and the variable marketing costs per unit on the 4.500 engines purchased will decline by 40% Calculate the cost in each option (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required.) Buy 4,500 units and make 4,500 units Make 9,000 unit Purchase cost Variable manufacturing Fixed manufacturing Variable marketing Fixed marketing Cost of option Difference in favour of mako option S 2-b. Determine whether the contractor's offer should be accepted? Yes . The Engine Guys produces specialized engines for "snow climber buses. The company's normal monthly production volume is 9,000 engines, whereas its monthly production capacity is 18,000 engines. The current selling price per engine is 51,300. The cost per unit of manufacturing and marketing the engines at the normal volume is as follows: Costs per Unit for Engines $ 100 200 34 Manufacturing costs Direct materials Direct labour Variable overhead Fixed overhead Subtotal Marketing costs: Variable 5 558 $ 65 Subtotal Total unit cost $ 766 Required: 1-a. The Provincial Bus Company wishes to purchase 740 engines in October. The bus company is willing to pay a fixed fee of $1,080,000 and reimburse The Engine Guys for all manufacturing costs incurred to manufacture 740 motors. October is a busy month for The Engine Guys, and there are sufficient orders to operate at 100% capacity utilization. There will be no variable marketing costs on this government contract. Compute the incremental benefit of the contract. 1-b. Indicate whether the Provincial Bus Company's contract should be accepted Yes NO 2-a. An outside contractor is willing to supply 4,500 engines at a price of 5624 per unit. If the offer is accepted, the company will make 4,500 engines in-house and buy 4.500 engines from the contractor. The company's fixed manufacturing costs will decline by 20% and the variable marketing costs per unit on the 4.500 engines purchased will decline by 40% Calculate the cost in each option (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required.) Buy 4,500 units and make 4,500 units Make 9,000 unit Purchase cost Variable manufacturing Fixed manufacturing Variable marketing Fixed marketing Cost of option Difference in favour of mako option S 2-b. Determine whether the contractor's offer should be accepted? Yes
