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Please send me the detailed answers to this exercise. Thank you very much Hannah Pty Ltd is a manufacturer of spices currently considering making dramatic
Please send me the detailed answers to this exercise. Thank you very much
Hannah Pty Ltd is a manufacturer of spices currently considering making dramatic changes to the company. It currently has production facilities in Gold Coast, Queensland, as well as in Asia. The CEO, Jim Carlos, is concerned about several issues currently facing the company and she would like to solve these using a sustainability approach. First, the major supplies of spices are imported from the small countries of East Asia. In both countries toxic chemical sprays are used on plantations, and these sprays have a long life. The spice processors in both countries pay their employees only AS3 per hour. The employees work long hours and breathe in chemical fumes, which over time may burn their lungs. Jim is considering setting up a factory for preliminary processing of spices in East Asia. Finance manager, Belen Bilanco, believes that setting up this factory is a good idea, as the setup costs will be only A$1.2 million. The current cost of processing spices at Gold Coast is S0.33 per kilogram but will fall to S0.11 per kilogram if pre-processing is Gold Coast figure is based on the following costs undertaken in East Asia. The Cost per kg $0.1508 0.0397 0.1395 $19 per hour to process 126 kilograms Direct labour Variable overhead S5 per hour to process 126 kilograms Fixed overhead$145 000 per annum to produce 1 039 427 kilo grams Total cost per kilogram S0.33 Matt Carlton, the production manager, believes that the quality of the final spice products will not reduce if the pre-pro cessing is undertaken off shore Second, although the Gold Coast plant currently meets the required environmental emissions standards, it has been prosecuted in the past for several violations of air pollution standards, and neighbours still complain about the smell. An improved filtering system would cost $290 000 to purchase and S17 500 per annum to run. Belen Bilanco believes there would be no financial benefits in improving the air quality since the facility meets government standards. He does not think that the new system should be purchased. The quality manager, Jullian Ses, disagrees and believes that the improvements would enhance the company's reputation and reduce discolouration of the buildings. The local newspaper has twice run stories that were critical of Hannah Pty Ltd. A recent story suggested that they were also water polluters, an assertion that the company claims is untrue. No contaminated water is released into the waterways; it is all evaporated using recycling ponds and a septic system. The third problem is continuing low employee morale at the Gold Coast plant. The previous production manager came to the plant from the army, and ran the factory very smoothly and efficiently, but using a military style. This led to serious clashes with some of the productionStep by Step Solution
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