A manager must decide which type of machine to buy, A, B, or C. Machine costs (per individual machine) are as follows: Machine A B с Product forecasts and processing times on the machines are as follows: Annual Product Demand 1 2 3 4 Cost $80,000 $70,000 $40,000 A B 25,000 22,000 20,000 9,000 A B с PROCCESSING TIME PER UNIT (minutes) A 5 3 3 5 Click here for the Excel Data File a. Assume that only purchasing costs are being considered. Compute the total processing time required for each machine type to meet demand, how many of each machine type would be needed, and the resulting total purchasing cost for each machine type. The machines will operate 10 hours a day, 250 days a year. (Enter total processing times as whole numbers. Round up machine quantities to the next higher whole number. Compute total purchasing costs using these rounded machine quantities. Enter the resulting total purchasing cost as a whole number.) Total processing time in minutes per machine: B 4 1 1 6 296,000 196,000 C 2 4 6 2 2 $ 2 Number of each machine needed and total purchasing cost 160,000
A manager must decide which type of machine to buy, A, B, or C. Machine costs (per individual machine) are as follows: Machine A B с Product forecasts and processing times on the machines are as follows: Annual Product Demand 1 2 3 4 Cost $80,000 $70,000 $40,000 A B 25,000 22,000 20,000 9,000 A B с PROCCESSING TIME PER UNIT (minutes) A 5 3 3 5 Click here for the Excel Data File a. Assume that only purchasing costs are being considered. Compute the total processing time required for each machine type to meet demand, how many of each machine type would be needed, and the resulting total purchasing cost for each machine type. The machines will operate 10 hours a day, 250 days a year. (Enter total processing times as whole numbers. Round up machine quantities to the next higher whole number. Compute total purchasing costs using these rounded machine quantities. Enter the resulting total purchasing cost as a whole number.) Total processing time in minutes per machine: B 4 1 1 6 296,000 196,000 C 2 4 6 2 2 $ 2 Number of each machine needed and total purchasing cost 160,000
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...
Related questions
Question
Transcribed Image Text:A manager must decide which type of machine to buy, A,
B, or C. Machine costs (per individual machine) are as
follows:
Machine Cost
A
B
C
Product forecasts and processing times on the machines
are as follows:
$80,000
$70,000
$40,000
Annual
Product Demand
1
25,000
2
22,000
3
20,000
4
9,000
A
B
PROCCESSING TIME PER
UNIT (minutes)
A
B
C
A
5
3
3
5
B
4
1
1
Click here for the Excel Data File
Total processing
time in minutes
per machine:
296,000
196,000
6
a. Assume that only purchasing costs are being
considered. Compute the total processing time required
for each machine type to meet demand, how many of each
machine type would be needed, and the resulting total
purchasing cost for each machine type. The machines will
operate 10 hours a day, 250 days a year. (Enter total
processing times as whole numbers. Round up machine
quantities to the next higher whole number. Compute
total purchasing costs using these rounded machine
quantities. Enter the resulting total purchasing cost as a
whole number.)
с
2
4
2 $
2
6
2
Number of each machine needed and
total purchasing cost
160,000
Expert Solution
Step 1: Define product forecasting:
Product forecasting also known as sales forecasting is the process of forecasting future demand for a particular product. Product forecasting helps the organization in the analysis of data by analyzing past events, determining the various factors that can influence product demand and regular monitoring activities.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Recommended textbooks for you
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.