What is the differential cost of Alternative B over Alternative A, including all

Question

What is the differential cost of Alternative B over Alternative A, including all of the relevant costs? dollar 44,000 dollar 149,000 dollar 105,000 dollar 127,000 Cress Company makes four products in a single facility. Data concerning these products appear below: The milling machines arc potentially the constraint in the production facility. A total of 11, 500 minutes arc available per month on these machines. How many minutes of milling machine time would be required to satisfy demand for all four products? 12,000 10,800 9,000 11,500 An investment project for which the net present value is dollar 300 would result in which of the following conclusions? The net present value is too small; the project should be rejected. The rate of return of the investment project is greater than the required rate of return. The net present value method is not suitable for evaluating this project; the internal rate of return method should be used. The investment project should only be accepted if net present value is zero; a positive net present value indicates an error in the estimates associated with the analysis of this investment.

Explanation / Answer

Question 14 details not clear or not   available.    15 Prodcuts Products A B C D Total Milling m/c minutes per unit                  2.60                  1.40                  0.80                  0.80 Monthly demand of units                 2,000                2,000                2,000               3,000 Monthly minutes required               5,200                2,800                1,600               2,400       12,000 So correcrt option is A .    16 When an Investment has NPV of $300, the conclusion that can be made is   B. The rate of return of the investment project is greater than the   required rate of return. So option B is correct. From the given information it cannot be decided whether the NPV is   too small, it is also not true that positive NPV is an error of estimate or not a suitable method for this project.

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