An industrial engineer has designed two alternative methods for accomplishing a production job. Both methods involve the acquisition of the same working place and other capital equipment to be used for this job only. Method A calls for a crew consisting of three men each costing Php30/hr. This method will result in the production of 10 units per hour of which two will be reject. Method B calls for a crew of two men each costing Php35/hr and should result in the production of eight units per hour of which one will be reject. The cost of the direct material lost in each reject is Php20. If a certain total number of units is to be produced find which method is economical?
An industrial engineer has designed two alternative methods for accomplishing a production job. Both methods involve the acquisition of the same working place and other capital equipment to be used for this job only. Method A calls for a crew consisting of three men each costing Php30/hr. This method will result in the production of 10 units per hour of which two will be reject. Method B calls for a crew of two men each costing Php35/hr and should result in the production of eight units per hour of which one will be reject. The cost of the direct material lost in each reject is Php20. If a certain total number of units is to be produced find which method is economical?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
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An industrial engineer has designed two alternative methods for accomplishing
a production job. Both methods involve the acquisition of the same working place
and other capital equipment to be used for this job only.
Method A calls for a crew consisting of three men each costing Php30/hr.
This method will result in the production of 10 units per hour of which two will be
reject.
Method B calls for a crew of two men each costing Php35/hr and should
result in the production of eight units per hour of which one will be reject.
The cost of the direct material lost in each reject is Php20. If a certain total
number of units is to be produced find which method is economical?
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