# A northern hardware company | Accounting homework help

A northern hardware company | Accounting

A northern hardware company is studying a    Accounting plan to open a new distribution center in southeast. The company plans to rent a warehouse and an adjacent office, and distribute its main products to the local dealers. The company has decided to initially start with four of its main products: Pressure washers, Go karts, Generators, and Water pumps. The company’s finance department has notified the management that such an investment is advised only if the new facility generates at least a net profit of \$400,000 in the first year of its operation.

The company estimates that the monthly rent and utilities will be about \$20,000. Also, the management plans to sign a contract with a local company to rent a number of forklifts for a monthly fee of \$1,500. Furthermore, the company estimates that it will have to spend an additional \$420,000 annually to hire a manager, a secretary, and five full time employees. The table below describes how much each of the products cost the company (including transportation costs):

Item                                          Cost in dollars

• Pressure washer                        \$320.00
• Go-kart                                         \$380.00
• (Case of 5 Water Pumps)         \$645.00

The company has set aside a budget of \$170,000 for merchandise each month to be sent to the new location. The selling prices (per unit) for each item are given below:

Item                               Selling price

• Pressure washer             \$499.99
• Go-kart                              \$719.99
• Generator                         \$699.99
• Water pump                     \$269.99

Other than the budget, another of the company’s concern is the available space in the warehouse. The warehouse has 82 shelves and each shelf is 30 ft long and 5 ft wide. Pressure washers and generators each are stored on 5 ft by 5 ft pallets whereas each Go Kart is stored on an 8 ft by 5 ft pallet. Furthermore, a 5 ft by 5 ft pallet is used to store four cases of water pumps (there are five water pumps in each case).

For promoting its brand products, the company’s marketing department has decided to allocate at least 30% of its inventory to pressure washers and Go Karts, and sell at least twice as many generators as water pumps.

Perform a monthly analysis using a linear programming model. Then determine whether the company should open its new branch in southeast.

Please complete the following in a Word document

1. Describe the three components of the LP problem. (5 points)

2. Write the formulation of the problem. (5 points)

3. Solve the problem in an Excel workbook by using the Excel Solver, and generate both the Answer and Sensitivity reports of Excel. (30 points)

4. Write the optimal solution in the word document, and explain whether the condition set by the company’s finance department has been satisfied. (5 points)

5. One of the decision variables has an optimal value of zero. In the word document, explain what the selling price of that item should be in order for this optimal solution value to change. (5 points)

6. In the word document explain whether, in addition to the \$170,000 allocated to the merchandise during the first month, the company should allocate additional money. If yes, how much additional investment do you recommend, and how much should the company expect its net profit to increase as a consequence? (5 points)

7. In the word document explain whether you recommend that the company should rent a smaller or a larger warehouse. In any case, indicate the size of your recommended warehouse in square feet, and indicate how much this change in the size of the warehouse will contribute to the yearly profit. (5 points)

Submissions must include both the completed Excel workbook and the completed Word document as attachments. Please note that incomplete submissions are not accepted.

## Calculate the price of your order

Select your paper details and see how much our professional writing services will cost.

We`ll send you the first draft for approval by at
Price: \$36
• Freebies
• Format
• Formatting (MLA, APA, Chicago, custom, etc.)
• Title page & bibliography
• Amendments to your paper when they are needed
• 275 word/double-spaced page
• 12 point Arial/Times New Roman
• Double, single, and custom spacing

Our custom human-written papers from top essay writers are always free from plagiarism.

Your data and payment info stay secured every time you get our help from an essay writer.

Your money is safe with us. If your plans change, you can get it sent back to your card.

## How it works

1. 1
You give us the details
Complete a brief order form to tell us what kind of paper you need.
2. 2
We find you a top writer
One of the best experts in your discipline starts working on your essay.
3. 3
You get the paper done

## Samples from our advanced writers

Check out some essay pieces from our best essay writers before your place an order. They will help you better understand what our service can do for you.

## Perks of our essay writing service

We offer more than just hand-crafted papers customized for you. Here are more of our greatest perks.

• Swift delivery
Our writing service can deliver your short and urgent papers in just 4 hours!
• Professional touch
We find you a pro writer who knows all the ins and outs of your subject.
• Easy order placing/tracking
Create a new order and check on its progress at any time in your dashboard.
• Help with any kind of paper
Need a PhD thesis, research project, or a two-page essay? For you, we can do it all.
• Experts in 80+ subjects