The price premium given for Husky is $200k over a comparable competitor’s machine ($1.2m vs. $1.0m). The table in Appendix A illustrates my calculations in solving for annual operations costs. Because Husky equipment is faster, I found “Husky Equivalent” costs for the competitor; that is, how much does it cost all-in for the competitor to run the same number of cycles that Husky’s machine can do in a year. 365 days of operation for Husky is roughly 489 days of operation for the competition. I made a number of assumptions, including resin cost per gram of $0.16 (the latest figure on the chart in Exhibit 11), 365 days of operations per year, and annual cost per square foot of $60 (average of the $20-$100 range given in the case).
Week 2 Cases C4-4 and C5-1 Carlos Carmona January 22, 2012 Benedictine University C4-4 Please See Attached Excel Document C5-1 1. Which company was the more profitable in 2006? (Hint: Compare ROE and ROA performance for the two grocery retailers.) Concentrating first thing on a comparing ROE, the Kroger Company performed better than Safeway in 2006. This is because Kroger’s ROE was 23.9% in comparison to 16.4% for Safeway.
Probabilities of these events are estimated to be .6 and .4 respectively. With a high response, gross revenues of $2 million are expected; with a low response, the figure is $450,000. If it starts with on North American test market, it might find a low response or a high response with probabilities .3 and .7, respectively. This may or may not reflect the global market potential. In any case, after conducting the market research, PLE next needs to decide whether to keep the sales only in North America, market globally, or drop the product.
The critical path is 6 months at a cost of $325,000, allowing your company to begin generating revenue in 6 months. However the ROI on this project is $250,000 over a 2- 3 year span. The company is looking at a revenue of about $100,000 for 2.5 years before
SciTronics had $ 75,000 of owners’ equity and earned $ 14,000 after taxes in 2008. Its return on equity was 18.67% an improvement from the 8.2% earned in 2005. Activity Ratios: How well does the company employ its assets? 1. Total asset turnover for SciTronics in 2008 can be calculated by dividing $ 244,000 into $ 159,000.
In order to calculate the cycle time we need the following: Production time per day / output per day in our conversation with Wu, there is a budget to produce 6 workbooks an hour, with a 40-hour workweek. This information can be used to calculate the cycle time; Production time per day is 8 hours or 480 minutes with a required 48 boots per day for a total of 10 minutes per unit Using these values we can see that the minimum workstation are simply calculated by dividing 46 minutes / 10 = 4.6 or 5 minimum stations and increasing the efficiency to 92%. 1. Please see attached copy of the excel POM workbook that backs up the information discussed above as well as it gives the most efficient production realignment as shown on table below, proving to be the best tool to increase efficiency and reduce the number of stations
Assume that (i) if the trial proceeds it is expected to last less than a month and result in two possible outcomes in terms of the price per share established in court: the $273,000 claimed by the plaintiffs, or the $55,400 being defended by Herbert Kohler; (ii) Kohler estimates the probabilities of these outcomes at 30% and 70%, respectively. 5. How would your answer to question 4 change if you also assume that (i) the inheritance tax owed on Frederic Kohler’s estate was 50.2% of its holdings in Kohler Co. (equivalent to 489 shares of the 975 he owned); (ii) the taxes paid by the estate amounted to $27 million (489 shares at $55,400 each); (iii) were the settlement or the trial to result in a revised share price in excess of $55,400, the IRS would likely demand a similar valuation for its claim on Frederic’s estate; and (iv) Herbert Kohler estimates the probability of the IRS’s demand at 100% if he proceeds to trial, and 50% if he
The data is read as follows: • The total demand for the six months is 4650 units. • The current inventory is 50 and • The target inventory for the end of the six month is 25, • This is where we have to reduce the required production for the six months So, we have no we should have 4625, brought on by (4650-25). The rest of the formula goes like this: 4625/ 6 months = 771. And this will be the required number of pumps needed monthly. Next is the number of pumps one employee can produce in one month.
A branch pipeline of this nature would typically cost between $1.8MM to $1.9MM, and with estimated annual operating and maintenance cost of about $8K-$9K. We can also assume a variable cost of $40.00/delivered ton. Industry standard would indicate that PH’s IRR would need to yield an 18% return on their capital investment for the life expectancy of this project. OP’s current daily average of spot ethylene gas purchase is between 35-36 tons. The average value (Exhibit 1 red line) represents the cost savings realized by Ohio over the total daily tonnage.
I feel like the price was a little high given the status of PacifiCorp, but then again PacifiCorp was the leading producer and distributor of low-cost energy to millions of customers across 6 states, and they were exactly what Berkshire Hathaway was looking to invest in, and at the time I believe that Buffet was getting anxious to invest in something to keep up his promise of a 24% annual growth rate, so maybe the bid price could have been a little higher. 3) How did Berkshire’s offer measure up against the company’s valuation implied by the multiples for comparable firms? In Exhibit 10 it shows that PacifiCorp’s book value was above the mean and median of comparable firms so the company’s business financials were in order, but also in Exhibit 9 it shows that PacifiCorp had a large amount of debt compared to other regulated Energy Firms. Buffet believes