Borges Machine Shop, Inc., has a 1-year contract for the production of 75,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow: Annual contracted units Annual fixed cost Per unit variable cost General-Purpose Equipment (GPE) 75,000 $100,000 $18.00 Flexible Manufacturing System (FMS) 75,000 $250,000 $14.50 Dedicated Machine (DM) 75,000 $500,000 $13.00
Borges Machine Shop, Inc., has a 1-year contract for the production of 75,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow: Annual contracted units Annual fixed cost Per unit variable cost General-Purpose Equipment (GPE) 75,000 $100,000 $18.00 Flexible Manufacturing System (FMS) 75,000 $250,000 $14.50 Dedicated Machine (DM) 75,000 $500,000 $13.00
Database System Concepts
7th Edition
ISBN:9780078022159
Author:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan
Publisher:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan
Chapter1: Introduction
Section: Chapter Questions
Problem 1PE
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![Borges Machine Shop, Inc., has a 1-year contract for the production of 75,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume
increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated
machine (DM). The cost data follow:
Annual contracted units
Annual fixed cost
Per unit variable cost
General-Purpose
Equipment (GPE)
75,000
$100,000
$18.00
Flexible Manufacturing
System (FMS)
75,000
$250,000
$14.50
Dedicated
Machine (DM)
75,000
$500,000
$13.00](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1027cba2-85fd-4401-a389-5e49baac07e3%2Fab9216e0-9544-498e-b326-fd500b8acee4%2Flizocfu_processed.png&w=3840&q=75)
Transcribed Image Text:Borges Machine Shop, Inc., has a 1-year contract for the production of 75,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume
increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated
machine (DM). The cost data follow:
Annual contracted units
Annual fixed cost
Per unit variable cost
General-Purpose
Equipment (GPE)
75,000
$100,000
$18.00
Flexible Manufacturing
System (FMS)
75,000
$250,000
$14.50
Dedicated
Machine (DM)
75,000
$500,000
$13.00
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