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The fixed and variable costs for four potential plant sites for Brent Snyder's Ski Supplies are shown below: Fixed Cost Per Year a) Graph the total-cost lines for the four potential sites. O A. O C. Cost (1,000s of $) Cost (1,000s of $) 300-3 250- 200- 150 100- 50- 0- 300- 250- Cleveland 200- 150- 100- 50- Atlanta 0 10 20 30 40 Volume (1,000s of units) Burlington Denver Denver Atlanta Cleveland Burlington 0- 0 10 20 30 40 Volume (1,000s of units) Q Q Site Atlanta Burlington Cleveland Denver $120,000 70,000 95,000 45,000 Variable Cost Per Unit $5 4 3 O B. D. Cost (1,000s of $) Cost (1,000s of $) 300- 250- 200- 150- 100- 50- Burlington 0 0 10 20 30 40 Volume (1,000s of units) 300-3 250- 200- 150- 100- 11 50- 0- Atlanta Denver Cleveland Denver Burlington Cleveland Atlanta 0 10 20 30 40 Volume (1,000s of units)

The fixed and variable costs for four potential plant sites for Brent Snyder's Ski Supplies are shown below: Fixed Cost Per Year a) Graph the total-cost lines for the four potential sites. O A. O C. Cost (1,000s of $) Cost (1,000s of $) 300-3 250- 200- 150 100- 50- 0- 300- 250- Cleveland 200- 150- 100- 50- Atlanta 0 10 20 30 40 Volume (1,000s of units) Burlington Denver Denver Atlanta Cleveland Burlington 0- 0 10 20 30 40 Volume (1,000s of units) Q Q Site Atlanta Burlington Cleveland Denver $120,000 70,000 95,000 45,000 Variable Cost Per Unit $5 4 3 O B. D. Cost (1,000s of $) Cost (1,000s of $) 300- 250- 200- 150- 100- 50- Burlington 0 0 10 20 30 40 Volume (1,000s of units) 300-3 250- 200- 150- 100- 11 50- 0- Atlanta Denver Cleveland Denver Burlington Cleveland Atlanta 0 10 20 30 40 Volume (1,000s of units)

Practical Management Science
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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Question content area Part 1 The fixed and variable costs for four potential plant sites for Brent​ Snyder's Ski Supplies are shown​ below:                                                                                Site Fixed Cost Per Year Variable Cost Per Unit Atlanta ​$120,000 ​$5 Burlington 70,000 4 Cleveland 95,000 3 Denver 45,000 11 Part 2
The fixed and variable costs for four potential plant sites for Brent Snyder's Ski Supplies are presented below: **Table of Costs:** | Site | Fixed Cost Per Year | Variable Cost Per Unit | |-----------|---------------------|------------------------| | Atlanta | $120,000 | $5 | | Burlington| $70,000 | $4 | | Cleveland | $95,000 | $3 | | Denver | $45,000 | $11 | **Graph Description:** The goal is to graph the total-cost lines for the four potential sites. There are four graph options labeled A, B, C, and D. Each graph plots the cost in thousands of dollars on the y-axis against volume in thousands of units on the x-axis, ranging from 0 to 40. - **Graph A** is selected as the correct graph. It shows: - *Cleveland* in green with a moderate slope starting at 95,000. - *Atlanta* in red with a steep slope starting at 120,000. - *Burlington* in blue with a gentle slope starting at 70,000. - *Denver* in cyan with the steepest slope starting at 45,000. - **Graph B** misplaces the line for *Denver* making it less steep compared to the others. - **Graph C** misorders some of the lines according to fixed and variable costs. - **Graph D** incorrectly positions the lines such that *Denver* appears higher and flatter than it should be given its costs. Each site's total cost is represented by the sum of its fixed cost and the product of its variable cost and the volume. The correct graphical representation of these relationships appears in option A.
Transcribed Image Text:The fixed and variable costs for four potential plant sites for Brent Snyder's Ski Supplies are presented below: **Table of Costs:** | Site | Fixed Cost Per Year | Variable Cost Per Unit | |-----------|---------------------|------------------------| | Atlanta | $120,000 | $5 | | Burlington| $70,000 | $4 | | Cleveland | $95,000 | $3 | | Denver | $45,000 | $11 | **Graph Description:** The goal is to graph the total-cost lines for the four potential sites. There are four graph options labeled A, B, C, and D. Each graph plots the cost in thousands of dollars on the y-axis against volume in thousands of units on the x-axis, ranging from 0 to 40. - **Graph A** is selected as the correct graph. It shows: - *Cleveland* in green with a moderate slope starting at 95,000. - *Atlanta* in red with a steep slope starting at 120,000. - *Burlington* in blue with a gentle slope starting at 70,000. - *Denver* in cyan with the steepest slope starting at 45,000. - **Graph B** misplaces the line for *Denver* making it less steep compared to the others. - **Graph C** misorders some of the lines according to fixed and variable costs. - **Graph D** incorrectly positions the lines such that *Denver* appears higher and flatter than it should be given its costs. Each site's total cost is represented by the sum of its fixed cost and the product of its variable cost and the volume. The correct graphical representation of these relationships appears in option A.
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