2. A polyurethane production plant requires total capital investment (TCI) of 10x106 TL and it manufactures...

 

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2. A polyurethane production plant requires total capital investment (TCI) of 10x106 TL and it manufactures 2000 tons of polyurethane annually. The price of polyurethane is set at 7 TL/kg. Direct Production Cost Items Raw materials costs Operating Labor Direct supervisory and clerical labor Utilities Maintenance and repairs Operating supplies 0.9 TL/ kg 0.6 TL/kg 17 % of operating labor 0.4 TL/kg 6% of FCI /kg 15% of maintenance and repairs 12% of operating labor 3% of TPC Laboratory charges Patents and royalties Fixed Charges Depreciation Local Taxes Insurance 10% of FCI /kg 2.5% of FCI /kg 0.7% of FCI /kg 10% of TPC Plant Overhead Costs General Expenses Administrative 15% of operating labor, direct supervisory and maintenance 5% of TPC 3% of TPC Distribution and Marketing Research & Development Consider that there is no interest charged on the investment. Working capital accounted as 12% of Total Capital Investment Financing is (a) total product cost (TPC/ kg) (b) the manufacturing cost (TL/kg) (c) profit before taxes (profit/kg) and annual profit before taxes (profit/year) (d) profit after income taxes (profit/kg) and annual profit after taxes (profit/year) 2. A polyurethane production plant requires total capital investment (TCI) of 10x106 TL and it manufactures 2000 tons of polyurethane annually. The price of polyurethane is set at 7 TL/kg. Direct Production Cost Items Raw materials costs Operating Labor Direct supervisory and clerical labor Utilities Maintenance and repairs Operating supplies 0.9 TL/ kg 0.6 TL/kg 17 % of operating labor 0.4 TL/kg 6% of FCI /kg 15% of maintenance and repairs 12% of operating labor 3% of TPC Laboratory charges Patents and royalties Fixed Charges Depreciation Local Taxes Insurance 10% of FCI /kg 2.5% of FCI /kg 0.7% of FCI /kg 10% of TPC Plant Overhead Costs General Expenses Administrative 15% of operating labor, direct supervisory and maintenance 5% of TPC 3% of TPC Distribution and Marketing Research & Development Consider that there is no interest charged on the investment. Working capital accounted as 12% of Total Capital Investment Financing is (a) total product cost (TPC/ kg) (b) the manufacturing cost (TL/kg) (c) profit before taxes (profit/kg) and annual profit before taxes (profit/year) (d) profit after income taxes (profit/kg) and annual profit after taxes (profit/year)

Answer rating: 100% (QA)

Solution Given TCI 1060 WC 12 of TCI WC 12 1060 12720 but TCI FCI WC Therefore FCI TCI WC 88 of TC... View the full answer