Engineering Economy
Engineering Economy
16th Edition
ISBN: 9780133582819
Author: Sullivan
Publisher: DGTL BNCOM
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Chapter 2, Problem 34P

(a):

To determine

Calculate the quantity.

(b):

To determine

Selection of machine.

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Assume you were hired as a Production Engineer in a global Bearing Manufacturer company and given the following inputs: Equipment Maintenance Cost per Month Utilities Cost per Month Material Cost per Unit Labor Cost per Unit Selling Price per Unit S60,000.00 $12.000.00 $12.00 $3.00 $24.00 Calculate Total Fixed Cost per Month Calculate Total Variable Cost per Unit = Calculate number of Units to be sold to reach Break-Even Point = Calculate number of Units that must be sold to eam profit of $90,000.00
Michael’s Lobster Food Truck has been operating for three years, but he’s yet to make a profit in the competitive food truck industry. Last year, he sold 2,500 items at an average price of $12. It costs him $9 to cover his ingredients for each item, and he also has fixed costs of $8,000 per year to cover for his truck, marketing, insurance, etc. What percentage increase in the number of units sold is required for Michael to break even?
A heavy equipment manufacturing company has produced its first unit using 3500 hours and $300,000 overhead cost. The next unit, i.e. the second unit took 3300 hours. Overhead cost for this unit was $200,000. Suppose the labor was $20 per hour. Being the production manager, you need to decide what would be the total production costs for additional 10 units after the completion of the second unit. Round the final amount to nearest integer. $1,597,832 C$1,003,183 (DNone of the above
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