Contemporary Engineering Economics (6th Edition)
6th Edition
ISBN: 9780134105598
Author: Chan S. Park
Publisher: PEARSON
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Chapter 12, Problem 14P
To determine
Calculate the additional annual cost.
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Company X has been contracting its overhauling work to Company Y for$40,000 per machine per year. Company X estimates that by building a $500,000 maintenance facility with a life of 15 years and a salvage value of $100,000 at the end of its life, it could handle its own overhauling at a cost of only $30,000 per machine per year. What is the minimum annual number of machines that Company X must operate to make it economically feasible to build its own facility, assuming an interest rate of 10%?
Estimated sales of a product is 30000 units. Two kinds of raw materials P and Q are required for manufacturing the product. Each unit of the product requires 2
units of P and 4 units of Q. The estimated cost of the P and Q OMR 2 and OMR 3 respectively.
The estimated opening balance in the beginning of the next year: finished goods: 4000 units; P: 6000 units; Q: 10000 units.
The desirable closing balance at the end of the next year: finished product: 6000 units: P: 10000 units: Q: 12000 units.
Which of the following shows the total cost of raw materials (OMR) to be purchased in Material Purchase Budget.
Select one:
O a. P = 162000 and Q = 181000
O b. P= 136000 and Q= 390000
O c.P = 124000 and Q =324000
O d. P = 134000 and Q = 334000
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Chapter 12 Solutions
Contemporary Engineering Economics (6th Edition)
Ch. 12 - Prob. 1PCh. 12 - Prob. 2PCh. 12 - Prob. 3PCh. 12 - Prob. 4PCh. 12 - Prob. 5PCh. 12 - Prob. 7PCh. 12 - Prob. 8PCh. 12 - Prob. 9PCh. 12 - Prob. 10PCh. 12 - Prob. 11P
Ch. 12 - Prob. 12PCh. 12 - Prob. 13PCh. 12 - Prob. 14PCh. 12 - Prob. 15PCh. 12 - Prob. 16PCh. 12 - Prob. 17PCh. 12 - Prob. 18PCh. 12 - Prob. 19PCh. 12 - Prob. 20PCh. 12 - Prob. 21PCh. 12 - Prob. 22PCh. 12 - Prob. 23PCh. 12 - Prob. 24PCh. 12 - Prob. 25PCh. 12 - Prob. 26PCh. 12 - Prob. 27PCh. 12 - Prob. 28P
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