Hickory Manufacturing Company forecasts the following demand for a product (in thousands of units) over the next five years. 1 2 3 4 5 55 76 79 82 82 Year Forecast demand Currently the manufacturer has eight machines that operate on a two-shift (eight hours each) basis. Thirty days per year are available for scheduled maintenance of equipment with no process output. Assume there are 250 workdays in a year. Each manufactured good takes 25 minutes to produce.
Hickory Manufacturing Company forecasts the following demand for a product (in thousands of units) over the next five years. 1 2 3 4 5 55 76 79 82 82 Year Forecast demand Currently the manufacturer has eight machines that operate on a two-shift (eight hours each) basis. Thirty days per year are available for scheduled maintenance of equipment with no process output. Assume there are 250 workdays in a year. Each manufactured good takes 25 minutes to produce.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Hickory Manufacturing Company forecasts the following demand for a product (in thousands of units) over the next five years.
1
2 3 4 5
76 79 82 82
55
Year
Forecast demand
Currently the manufacturer has eight machines that operate on a two-shift (eight hours each) basis. Thirty days per year are available for
scheduled maintenance of equipment with no process output. Assume there are 250 workdays in a year. Each manufactured good takes 25 minutes
to produce.
a. What is the effective capacity of the factory? Round your answer down to the nearest whole number.
units/year
b. Given the five-year forecast, how much extra capacity is needed each year? Use a minus sign to enter an answer, if there is excess capacity.
Round your answers to the nearest whole number.
Year
Extra capacity needed (units)
c. Does the firm need to buy more machines? If so, how many? When? If your answer is zero, enter "0". Round your answers up to the nearest
whole number.
Year
Additional machines needed
1
1
2
2
3
3
4
5
5](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc00f41a8-3019-411c-9841-b4d3b90602dd%2Fc2e0acab-f5d9-4606-bbcd-ac342b491c26%2Fry3me84_processed.png&w=3840&q=75)
Transcribed Image Text:Hickory Manufacturing Company forecasts the following demand for a product (in thousands of units) over the next five years.
1
2 3 4 5
76 79 82 82
55
Year
Forecast demand
Currently the manufacturer has eight machines that operate on a two-shift (eight hours each) basis. Thirty days per year are available for
scheduled maintenance of equipment with no process output. Assume there are 250 workdays in a year. Each manufactured good takes 25 minutes
to produce.
a. What is the effective capacity of the factory? Round your answer down to the nearest whole number.
units/year
b. Given the five-year forecast, how much extra capacity is needed each year? Use a minus sign to enter an answer, if there is excess capacity.
Round your answers to the nearest whole number.
Year
Extra capacity needed (units)
c. Does the firm need to buy more machines? If so, how many? When? If your answer is zero, enter "0". Round your answers up to the nearest
whole number.
Year
Additional machines needed
1
1
2
2
3
3
4
5
5
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