1.
Once the budget is close to done, Alice looks over their financial plans for the year to be sure that they can afford everything at the time that it is needed.
2.
Alice wants to figure out how much the project is worth so far. So she adds up the value of all of the materials she has used, and subtracts the labor and any depreciation that needs to be accounted for. The number she ends up with gives the value of the overall project right now.
3.
Before Tamika and Sue decided to do the remodeling, they compared how much the project was going to cost to how much good they thought it would do for them.
4.
Tamika helps Alice add up all of the estimates they have done into control accounts so that they can figure out how much the stereo installation is going to cost versus building the entertainment center.
5.
Even though the system she is currently installing is state of the art, Alice knows that within a year or so it will be on sale for half as much as she is paying now.
6.
Alice does such a good job planning out her entertainment center remodeling that the Smiths down the street ask if they can have her help with their home theater upgrade. Since she is too busy doing the work on the Kitchen, she has to say no. Rob Smith says, “That’s a shame; we were willing to pay $1,000 to someone to help us out with this.”
7.
In a manufacturing facility that makes electronic widgets, the main widget making machine is getting old and a project is formed to consider the replacement of this machine. The average cost of the operations performed on this machine for making a widget is $5.00 per unit. A new machine can be purchased for $50,000 that will perform these operations much more quickly and with less scrap and rework for an average cost of $3.00 per unit. An alternative machine is even faster than the first machine considered and will perform the same operations for $2.00 per unit. However, this machine will cost $75,000. The company manufactures 1,000 widgets each month. What is the break even point for the $75,000 machine compared to the existing machine?
8.
Alice reads a newspaper article that says that there has been a sharp increase in lumber costs recently. She knows this wasn’t in her contractor’s original plan and decides to put a few hundred dollars aside to deal with the price hike if it should happen.
9.
In a manufacturing facility that makes electronic widgets, the main widget making machine is getting old and a project is formed to consider the replacement of this machine. The average cost of the operations performed on this machine for making a widget is $5.00 per unit. A new machine can be purchased for $50,000 that will perform these operations much more quickly and with less scrap and rework for an average cost of $3.00 per unit. An alternative machine is even faster than the first machine considered and will perform the same operations for $2.00 per unit. However, this machine will cost $75,000. The company manufactures 1,000 widgets each month. If the production of widgets is expected to continue for at least three years, what is the preferred action?
10.
The minute the TV gets installed, Alice starts inviting all of her friends over to the Kitchen to watch the games on the weekend. She charges a $2 cover charge for her football Saturdays and has been clearing about $20 per week even though the room isn’t finished.
