Engineering Economy
16th Edition
ISBN: 9780133582819
Author: Sullivan
Publisher: DGTL BNCOM
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Chapter 3, Problem 14P
To determine
Calculate the estimated capital investment.
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The capital investment cost for a switchgrass-fueled ethanol plant with a capacity of 250.000 gallons per year is $6.6 million. The costcapacity factor for this particular plant
technology is 0.62 for capacities ranging from 200.000 gallons per year to 600.000 gallons per year. What is the estimated capital investment for a similar ethanol plant with a capac
of 550.000 gallons per year?
The estimated capital investment for a similar ethanol plant with a capacity of 550,000 gallons per year is $ (Round to the nearest ten thousands)
An Engineering consultant firm measures its output in a standard hour unit, which is a function of the personnel grade levels in the professional stuff. The variable cost is $62 per standard service hour. The charge-out rate (i.e., selling price) is $85.56 per hour. The maximum output of the firm is 160,000 hours per year, and its fixed cost is $2,024,000 per year. For this firm:
(a) What is the breakeven point in standard service hours and in percentage of total capacity?
(b) What is the percentage reduction in breakeven (sensitivity) if fixed costs are reduced 10%; if variable cost per hour is reduced 10%; and if the selling price per unit is increased by 10%.
Note:-
Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.
Answer completely.
You will get up vote for sure.
A company is analyzing a make-versus-purchase situation for a component used in several products, and the engineering department has developed these data:
Option A:
Purchase 10,000 items per year at a fixed price of $9.31 per item. The cost of placing the order is negligible
according to the present cost accounting procedure.
Option B:
Manufacture 10,000 items per year, using available capacity in the factory. Cost estimates are direct
materials=$5.16 per item and direct labor=$1.57 per item. Manufacturing overhead is allocated at 200% of
direct labor (-$3.14 per item).
Based on these data, should the item be purchased or manufactured?
The total cost of Option A is $. (Round to the nearest dollar)
The total cost of Option B is $
(Round to the nearest dollar.)
Should the item be purchased or manufactured? Choose the correct answer below.
The item should be manufactured.
The item should be purchased.
00
Chapter 3 Solutions
Engineering Economy
Ch. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Prob. 6PCh. 3 - Prob. 7PCh. 3 - Prepare a composite (weighted) index for housing...Ch. 3 - Prepare a composite (weighted) index for housing...Ch. 3 - Prob. 10P
Ch. 3 - Prob. 11PCh. 3 - Prob. 12PCh. 3 - Prob. 13PCh. 3 - Prob. 14PCh. 3 - Prob. 15PCh. 3 - A biotech firm is considering abandoning its old...Ch. 3 - Prob. 17PCh. 3 - Prob. 18PCh. 3 - Prob. 19PCh. 3 - Prob. 20PCh. 3 - Prob. 21PCh. 3 - Prob. 22PCh. 3 - Prob. 23PCh. 3 - Prob. 24PCh. 3 - Prob. 25PCh. 3 - Prob. 26PCh. 3 - Prob. 28SECh. 3 - Prob. 31CSCh. 3 - Prob. 32CSCh. 3 - Prob. 36FECh. 3 - Prob. 37FECh. 3 - Prob. 38FECh. 3 - Prob. 39FECh. 3 - Prob. 40FECh. 3 - Prob. 41FE
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