John Smithers

“United Screen Printers”


Executive Summary

United Screen Printers produces a wide range of decals for displaying promotional messages on fleet vehicles. The company is expecting an increase in sales due to an increase in frequency and use of this technique for advertising. The company needs to decide which of the six proposed projects for next year is going to be taken.


Analysis

Since the company typically allocates 10% of sales to projects, management currently has about $700,000 to invest in different projects. The cost of the projects is as follows:

Project Cost
1. Purchase new large press $160,000
2. Build new headquarters $4,000,000
3. Pursue ISO 9000 Certification $250,000 - $300,000
4. Develop formal procedure for mixing inks $10,000
5. Purchase and install equipment to produce four-color positives in-house $175,000
6. Purchase inkjet printers $140,000

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