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Tigra Company Manufactures Engines II Supplier Data -Refer to the Figure

question 96

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Tigra Company manufactures engines. Tigra produces all the parts necessary for its engines except for one electronic component, which is purchased from two local suppliers: Customer 1 and Customer 2. Both suppliers are reliable and rarely deliver late; however, Customer 1 sells the component for $10.00 per unit and Customer 2 sells the same component for $8.95. Hamilton purchases 70% of its components from Customer 2 because of the lower price. The total annual demand is 75,000 units.
I. Activity Data
 Inspecting components (sampling only)  $190,000 Reworking products (due to failed component)  $2,254,000 Warranty work (due to failed component)  $1,723,000\begin{array}{ll}\text { Inspecting components (sampling only) } & \$ 190,000 \\\text { Reworking products (due to failed component) } & \$ 2,254,000 \\\text { Warranty work (due to failed component) } & \$ 1,723,000\end{array}
II. Supplier Data
 Customer 1 Customer 2 Units Purchase Price $10.00$8.95 Units Purchased 22,50052,500 Sampling Hours 502,450 Rework Hours 1353,625 Warranty Hours 4756,000\begin{array}{lrr}&\text { Customer } 1&\text { Customer } 2\\\text { Units Purchase Price } & \$ 10.00 & \$ 8.95 \\\text { Units Purchased } & 22,500 & 52,500 \\\text { Sampling Hours } & 50 & 2,450 \\\text { Rework Hours } & 135 & 3,625 \\\text { Warranty Hours } & 475 & 6,000\end{array}
-Refer to the Figure.What is the activity rate for reworking products on the basis of rework hours?

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Definitions:

Liquidity

The ability of an asset to be quickly converted into cash or the ability of a company to meet its short-term financial obligations.

Federal Government

The national government of a federated state, which holds the authority to govern at a national level, possessing powers typically outlined in a constitution.

Stockholders

Individuals or entities that own shares in a corporation, granting them certain rights and interests in the company's performance and governance.

Long-Term Creditors

Individuals or institutions that lend money to an entity with repayment terms extending beyond one year.

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