Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the following production cost data: Process Type Annualized Fixed Cost of Plant & Equip. Variable Costs (Per Unit) ($) Labor Material Energy Mass Customization $1,000,000 30 18 12 Intermittent $1,200,000 28 16 20 Repetitive $1,625,000 26 15 12 Continuous $1,960,000 25 15 10 Metters Cabinets projects an annual demand of 30,000 units for the Maxistand. The Maxistand will sell for $140 per unit. Which process type will maximize the annual profit from producing the Maxistand? What is the value of this annual profit? solve the question using Excel OM.
Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the following production cost data: Process Type Annualized Fixed Cost of Plant & Equip. Variable Costs (Per Unit) ($) Labor Material Energy Mass Customization $1,000,000 30 18 12 Intermittent $1,200,000 28 16 20 Repetitive $1,625,000 26 15 12 Continuous $1,960,000 25 15 10 Metters Cabinets projects an annual demand of 30,000 units for the Maxistand. The Maxistand will sell for $140 per unit. Which process type will maximize the annual profit from producing the Maxistand? What is the value of this annual profit? solve the question using Excel OM.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the following production cost data:
Process Type
Annualized Fixed Cost of Plant & Equip.
Variable Costs (Per Unit) ($)
Labor
Material
Energy
Mass Customization
$1,000,000
30
18
12
Intermittent
$1,200,000
28
16
20
Repetitive
$1,625,000
26
15
12
Continuous
$1,960,000
25
15
10
Metters Cabinets projects an annual demand of 30,000 units for the Maxistand. The Maxistand will sell for $140 per unit.
Which process type will maximize the annual profit from producing the Maxistand?
What is the value of this annual profit?
solve the question using Excel OM.
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