Refer to the Figure

question 104

Essay

Refer to the Figure.Calculate the following: A. Conversion cost in minutes
B. Theoretical conversion cost per unit
C. Actual conversion cost per unit
D. How much more is the department spending per application than it should be if perfect efficiency could be attained?

---

Definitions:

Present Value

The present worth of a future amount of money or series of cash flows, considering a certain interest rate.

Future Lease Payments

The amounts due over the lease term for the use of an asset.

Salvage Value

The estimated value that an asset will realize upon its sale at the end of its useful life.

Captive Finance Company

A subsidiary whose primary purpose is to provide financing to customers buying the parent company's product, facilitating purchases and increasing sales.