Part E: Relevant Cost For Sell Or Process Further

Part E Relevant Costsell Or Process Furtherfarrugia Corporation Prod

Part E: Relevant Cost/Sell or Process Further Farrugia Corporation produces two intermediate products, A and B, from a common input. Intermediate product A can be further processed into end product X. Intermediate product B can be further processed into end product Y. The common input is purchased in batches that cost $36 each and the cost of processing a batch to produce intermediate products A and B is $15. Intermediate product A can be sold as is for $21 or processed further for $14 to make end product X that is sold for $32. Intermediate product B can be sold as is for $44 or processed further for $28 to make end product Y that is sold for $64. Required: a. Assuming that no other costs are involved in processing potatoes or in selling products, how much money does the company make from processing one batch of the common input into the end products X and Y? Show your work! b. Should each of the intermediate products, A and B, be sold as is or processed further into an end product? Explain. Part F: Relevant Cost/Dropping a Product The management of Woznick Corporation has been concerned for some time with the financial performance of its product V86O and has considered discontinuing it on several occasions. Data from the company's accounting system appear below: Sales ................................................................ $150,000 Variable expenses ............................................ $72,000 Fixed manufacturing expenses ........................ $50,000 Fixed selling and administrative expenses ...... $33,000 In the company's accounting system, all fixed expenses of the company are fully allocated to products. Further investigation has revealed that $30,000 of the fixed manufacturing expenses and $13,000 of the fixed selling and administrative expenses are avoidable if product V86O is discontinued. Required: A. According to the company's accounting system, what is the net operating income earned by product V86O? B. What would be the effect on the company's overall net operating income if product V86O were dropped? The nurse is assigned to develop a nursing protocol regarding patient care to be included in the disaster plan coordinating agreement between the LTCF and the health department. The health department team will work with representatives from the LTCF nursing department. Use the following template to develop this policy/protocol: · Designated authority. · Describe the problem. List the proposed nursing diagnosis. · Background: Introduce the business case for why developing this protocol is necessary. Provide the data and information to support the protocol. · Identify other persons needed to serve on this team from both the LTCF and health department. · Generate a list of what information about the nursing care facility is needed to develop this plan and delineate assignments to the appropriate persons. · Objectives: Delineate one to three objectives for this plan. Make sure the objectives are in behavioral terms, are measurable and realistic. Include timeframes. · Proposed Interventions: Develop a comprehensive list of action steps for both the LTCF and the health department to be included in this plan. · Expected Benefits: Describe the expected benefits and outcome of the interventions taken. · Audit and evaluation: Describe how the outcomes will be evaluated. Propose what and how pertinent audit findings will be used to evaluate the success of the plan. Describe how ongoing monitoring and review of the strategies will be done.

Paper For Above instruction

Relevant Cost Analysis of Farrugia Corporation's Batch Processing Decisions

The decision-making process within Farrugia Corporation concerning whether to process intermediate products into end products involves a detailed analysis of relevant costs and benefits. This process is central to ensuring profitable operations, as it determines whether further processing adds value or merely incurs additional costs without a proportional return. This paper examines the costs and revenues associated with processing or selling intermediate products A and B, providing a comprehensive evaluation of the company's options based on the given data.

Part A: Financial Outcomes from Processing Decisions

To assess the profitability of further processing, we first need to analyze the incremental costs and revenues associated with processing each intermediate product into its respective end product, X and Y. For product A, the relevant costs include the batch cost ($36), processing cost ($14), and the selling price of the processed product ($32). If the company sells product A as is, the revenue is $21, and it avoids additional processing costs.

Calculations for product A:

• Sell as is: $21
• Process further: Revenue from end product X ($32) minus additional processing costs ($14) and batch costs ($36 if considered part of the overall process). However, since batch costs are fixed per batch and are incurred regardless of processing decision, the incremental costs relevant are only the processing cost ($14).

Net gain from processing product A:

$32 (selling price of X) - $14 (processing cost) = $18

Comparison of selling as is ($21) versus processing further ($18):

Since $21 > $18, it's more profitable to sell the intermediate product A as is.

Similarly, for product B:

• Sell as is: $44
• Process further: Revenue from end product Y ($64) minus processing costs ($28) and batch costs ($36). Again, batch costs are fixed, so the relevant incremental cost is $28.

Net gain from processing product B:

$64 - $28 = $36

Since $44 (selling as is)

Overall profit from processing one batch involves summing the net gains or losses from each product, adjusted by their respective choices.

Part B: Evaluation of Processing Decisions

The analysis indicates that for product A, selling as is yields $21 per batch, whereas processing yields an $18 return; thus, selling as is is preferable. For product B, selling as is yields $44, compared to $36 if processed further, making the sale of B as is the better option. These decisions hinge on the focus of relevant costs—specifically avoiding additional processing expenses when the return from processing is less favorable.

Relevant Cost Analysis of Woznick Corporation's Product Discontinuation

The comprehensive evaluation of whether to discontinue product V86O necessitates an understanding of the systematic costs involved and the potential impact on overall profitability. According to the company's accounting data, the net operating income attributable to V86O can be calculated by subtracting the fully allocated fixed expenses from the sales revenue attributable to the product.

Part A: Net Operating Income Based on Company's Accounting System

Sales revenue for V86O is $150,000, with variable expenses of $72,000, fixed manufacturing expenses of $50,000, and fixed selling and administrative expenses of $33,000. Since fixed expenses are fully allocated, the net operating income attributable to V86O equals:

Revenue ($150,000) - Variable expenses ($72,000) - Fixed expenses ($50,000 + $33,000) = -$5,000

This negative value indicates a loss of $5,000, based on fully allocated fixed costs, which suggests V86O is not contributing positively to the company's profit under current accounting practices.

Part B: Impact of Discontinuing V86O

Alternative analysis considers the avoidable fixed costs if V86O is discontinued, which amount to $30,000 of manufacturing expenses and $13,000 of selling and administrative expenses. Eliminating these costs would change the profit implications significantly.

Net effect on overall profitability:

• Exclude the avoidable fixed costs: $30,000 + $13,000 = $43,000
• Recalculate contribution: Revenue ($150,000) minus variable expenses ($72,000) gives a contribution margin of $78,000.
• Subtract the non-avoidable fixed expenses: $78,000 - ($50,000 - $30,000) - ($33,000 - $13,000) = $78,000 - $20,000 - $20,000 = $38,000

Therefore, discontinuing V86O could improve the company’s overall net operating income by alleviating losses and avoiding unavoidable fixed costs, depending on the structure of fixed expenses and their allocability.

Nursing Protocol for Disaster Preparedness in LTCF

The development of a comprehensive nursing protocol for disaster preparedness within Long-Term Care Facilities (LTCFs) is critical for ensuring coordinated, effective patient care during emergencies. This protocol will define roles, responsibilities, and procedures, aligning LTCF practices with those of the health department to optimize patient outcomes and safety.

Designated Authority

The designated authority for this protocol is the Director of Nursing within the LTCF, in collaboration with the Community Health Coordinator from the local health department.

Problem Description and Nursing Diagnoses

The primary issue addressed by this protocol is the potential for disrupted patient care during disasters, including natural calamities and pandemics, which necessitates an organized response system. Nursing diagnoses include Risk for Infection, Risk for Injury, Ineffective Coping, and Potential for Dehydration, among others.

Background and Business Case

Effective disaster response reduces morbidity and mortality among vulnerable LTCF residents. Data indicates increased risk during disasters, emphasizing the need for pre-established, clear guidelines. Developing this protocol minimizes chaos, ensures resource availability, and enhances communication among stakeholders, ultimately improving patient safety and care continuity.

Team Composition

• LTCF senior nursing staff and emergency preparedness coordinators
• Health department disaster response specialists
• Clinical staff including RNs and LPNs
• Administrative personnel from both organizations

Information Needs and Assignment

The team requires detailed resident health profiles, emergency contact data, equipment inventories, medication lists, and facility structural information. Assignments include data collection by nursing staff, facility assessment by maintenance teams, and policy development by administrative leaders.

Objectives

• Develop a comprehensive disaster response protocol within three months (Specific, Measurable, Achievable, Relevant, Time-bound).
• Conduct training sessions for all staff within one month of protocol finalization.
• Establish communication channels and resource inventories within six weeks.

Proposed Interventions

• Assemble multidisciplinary disaster planning team.
• Conduct risk assessments and resource audits.
• Draft, review, and approve disaster response procedures.
• Implement staff training and simulation exercises.
• Set up communication protocols with local emergency services.

Expected Benefits

Enhanced resident safety, optimized resource utilization, reduced response time during emergencies, and compliance with health and safety regulations are anticipated benefits.

Evaluation and Monitoring

Outcome evaluations will include drills and audits to assess staff responsiveness, resource readiness, and communication effectiveness. Feedback will guide continuous improvements, and regular reviews will ensure the protocol remains current with evolving best practices and regulations.

References

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• CDC. (2020). Emergency preparedness and response in LTCFs. Centers for Disease Control and Prevention. Retrieved from https://www.cdc.gov/longtermcare/emergencypreparedness.html
• Gordon, L. A., et al. (2018). Nursing roles in disaster management. Nursing Outlook, 66(2), 211-218.
• Johnson, S. R., et al. (2017). Cost-effectiveness of disaster response planning in healthcare settings. Healthcare Management Review, 42(3), 228-237.
• Marquis, B. L., & Huston, C. J. (2015). Leadership roles in emergency preparedness. Nursing Administration Quarterly, 39(4), 336-342.
• RN, T., & Smith, R. (2019). Creating effective disaster protocols in LTCFs. Journal of Long-Term Care Management, 15(2), 45–52.
• U.S. Department of Health & Human Services. (2018). Long-term care facility emergency preparedness. HHS Guidelines, 2018.
• World Health Organization. (2017). Framework for health emergency and disaster risk management. WHO Press.
• Zhou, Y., et al. (2020). Enhancing disaster readiness through nursing training. Journal of Nursing Education, 59(6), 345-350.