3. You currently purchase a part used in your production process from an outside supplier, and have decided to begin making this part in-house. You have two equipment options for moving production in-house: special-purpose equipment and general-purpose equipment. Cost information for these two options is as follows: Scenario 2.6 VARIABLE COST $15 per unit $20 per unit FIXED COST ALTERNATIVE Special-Purpose Equipment $200,000 per year General-Purpose Equipment $50,000 per year ) Use Scenario 2.6 to answer this question. What is the breakeven quantity between the two options? A) 30,000 units per year B) 40,000 units per year C) 50,000 units per year D) 60,000 units per year ii) Use Scenario 2.6 to find the truth. What are total costs under the Special-Purpose Equipment option for an annual quantity of 40,000 units? A) $400,000 B) $500,000 C) $800,000 D) $850,000

3. You currently purchase a part used in your production process from an outside supplier, and have decided to begin making this part in-house. You have two equipment options for moving production in-house: special-purpose equipment and general-purpose equipment. Cost information for these two options is as follows: Scenario 2.6 VARIABLE COST $15 per unit $20 per unit FIXED COST ALTERNATIVE Special-Purpose Equipment $200,000 per year General-Purpose Equipment $50,000 per year ) Use Scenario 2.6 to answer this question. What is the breakeven quantity between the two options? A) 30,000 units per year B) 40,000 units per year C) 50,000 units per year D) 60,000 units per year ii) Use Scenario 2.6 to find the truth. What are total costs under the Special-Purpose Equipment option for an annual quantity of 40,000 units? A) $400,000 B) $500,000 C) $800,000 D) $850,000

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

See similar textbooks

Related questions

Q: The S&OP team at Kansas Furniture, has received estimates of demand requirements as shown in the…

A: Production inventory management calls for a methodical and strategic approach. Typically, producers…

Q: Complete the following statements with one of the terms listed here. You may use a term more than…

A: Business environment refers to the external factors and conditions that affect a business's…

Q: Corey spent the month of December talking to various suppliers in order to figure out how much all…

A: Manufacturing Costs can be defined as an implies costs for manufacturing a Compound or Product given…

Q: Explain what ERP is, what it does, and how much it costs beyond what the customer sees.

A: In the modern era of a dynamic marketplace, the only technique an organization can use to flourish…

Q: Discuss how does ERP match the management of e-commerce and supply chain management?

A: ERP (Enterprise Resource Planning Systems) is an acronym for Enterprise Resource Planning Systems.…

Q: Suppose that you're a CTO of a company and tasked of building a new warehouse for your Org's…

A: Operation management is an aspect of management that deals with the management of the production,…

Q: What are the capabilities of supply chain managementsoftware? How do ERP and SCM relate?

A: We would discuss on the capabilities of Supply Chain Management software and would also focus on the…

Q: This is a question on make or buy scenarios. Should a manufacturer consider outsourcing a component…

A: What Is a Make-or-Buy Decision?A make-or-buy decision is a demonstration of picking either…

Q: Recent residential and industrial growth in Butler County has the potential for increasing demand by…

A: Objective function and decision variables remain same. Only constraints change.Now, the total…

Q: What parta of the supply chain are most costly involved with the situation in this case?what is the…

A: Elements of supply chain elaborate are as follows: Obtaining and delivery of goods. Plan the…

Q: What is FR(N)? How is it calculated? How are FR(N) and MTBF related?

A: Answer: In the domain of reliability management, FR means failure rate of products which is…

Q: Give me for each area the advantage and disadvantages for CRM, ERP, highest-added-value activity,…

A: A Small Introduction about ERP Management ERP means "enterprise resource planning." ERP…

Q: stories that highlighted the difficulties in purchasing , installing or failure of an ERP system

A: Leaseplan commissioned HCL Technologies to develop a new SAP-based Core Leasing System (CLS) that…

Q: Thunderbird Manufacturing purchases a new stamping machine for $40,000. Its useful life is estimated…

A: Cost of the machine=$40,000 Expected useful life of production=2,50,000 units Residual value of…

Question

100%

Uhersity of Bellie
3. You currently purchase a part used in your production process from an outside
supplier, and have decided to begin making this part in-house. You have two equipment options for
moving production in-house: special-purpose equipment and general-purpose equipment. Cost
information for these two options is as follows:
Scenario 2.6
VARIABLE COST
$15 per unit
$20 per unit
FIXED COST
ALTERNATIVE
Special-Purpose Equipment $200,000 per year
General-Purpose Equipment $50,000 per year
) Use Scenario 2.6 to answer this question. What is the breakeven quantity between the two
options?
A) 30,000 units per year
B) 40,000 units per year
C) 50,000 units per year
D) 60,000 units per year
ii) Use Scenario 2.6 to find the truth. What are total costs under the Special-Purpose Equipment
option for an annual quantity of 40,000 units?
A) $400,000
B) $500,000
C) $800,000
D) $850,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.

Similar questions

Can someone help me to calculate the lead time for Supplier A? Supplier A: has 2 days to review the order and schedule the order, 5 days to manufacture the order, 1 day to pick up and pack the order, with an Ocean transit time of 12, 3 days to clear customs, and 1 day of inland transport from port to buyer's facility. Thanks!
Briefly describe how supply chain planning and control is managed in an ERP system.
What is the relationship between ERP and e-commerce and supply chain management?
With radio frequency (RFID) tags, items can be tracked during production and in inventory?
What are the advantages of TPS, CRM, and SCM?
The S&OP team at Kansas Furniture, has received estimates of demand requirements as shown in the table. Assuming one-time stockout costs for lost sales of $100 per unit, inventory carrying costs of $25 per unit per month, and zero beginning and ending inventory, evaluate the following plan on an incremental cost basis: Plan A: Produce at a steady rate (equal to minimum requirements) of 1,200 units per month and subcontract additional units at a $70 per unit premium cost. Subcontracting capacity is limited to 500 units per month. (Enter all responses as whole numbers). The total cost, excluding normal time labor costs, for Plan A = $ Month Ending Subcontract Demand Production Inventory (Units) 1 July 1200 1,200 0 0 2 August 1300 1,200 0 100 3 September 1200 1,200 0 0 4 October 1700 1,200 0 500 5 November 1650 1,200 0 450 6 December 1400 1,200 0 200 (Enter your response as a whole number.)
Assume Port Aventura has decided to pursue acquiring an ERP system. What components do you recommend they include in the system? Explain why you have selected these components. Based on the KPI's you recommended last week, will these KPI's be able to be measured given your selection of ERP components?
Protocase is a major employer in CBRM, an analysis of protocase and detailed explanation of logistics functions -----transportation, warehouse and inventory need an explanation on all the aspects and how to improve all these
The Vera Molding company has two alternatives for meeting a customer requirement for 9,500 units of a specialty molding. If done in-house, fixed cost would be $300,000 with variable cost at $40 per unit. Alternative two is to outsource for a total cost of $80 per unit. What is the break-even quantity? Round your answer to the nearest whole number. units Should the firm make the 9,500 units in-house or outsource? Firm should produce the molding .
Perez POPS POS Katie Perez, owner of Perez POPS, realizes she needs a Point of Sale System (POS) for her main shop but also something that could be used for parties, events etc. Flexibility and portability is important. Choosing the right one will require some research. She has heard of Square but doesn't know anything about it. She would really like to have a couple options to consider. She has asked you, her consultant, to investigate Square and a second POS system appropriate for a small business like hers. Report your findings to Katie with a persuasive business email that has a table detailing the features/pros/cons of both POS options. Finally, offer your recommendation as to which one would be the best solution for her. Business Email should include the following: Use a standard business email template which has - To, From, Date and Subject or Re: Put page numbers on the email if it goes over 1 page Include a link embedded in the email to each POS system you are referencing in…