In: Accounting
Problem 1
Chapter 7: Your hospital has applied for certification as a level 1 stroke center. It is critical that the following project is completed before the next Joint Commission survey in 18 weeks. Project activity times are listed in the table below.
Activity |
Immediate Predecessors |
Normal Time (NT) (weeks) |
Normal Cost (NC) ($) |
Crash Time (CT) (weeks) |
Crash Cost (CC) ($) |
A |
--- |
6 |
$600 |
2 |
$1,400 |
B |
A |
7 |
$200 |
3 |
$600 |
C |
--- |
9 |
$500 |
6 |
$950 |
D |
C |
2 |
$800 |
1 |
$1,200 |
E |
D |
8 |
$1,600 |
5 |
$2,800 |
F |
B, D |
5 |
$200 |
4 |
$400 |
G |
F |
4 |
$400 |
3 |
$750 |
ANSWER
ALL POSSIBLE PATHS:
ABFG = 22
CDFG = 20
CDE = 19
CRITICAL PATH = NETWORK CHAIN WITH THE LONGEST DURATION = ABFG = 22
DURATION OF CRITICAL PATH = 22
CRASHING
CRASH COST PER PERIOD = (CRASH COST - NORMAL COST) / (NORMAL TIME - CRASH TIME)
ACTIVITY |
NORMAL TIME |
CRASH TIME |
NORMAL COST |
CRASH COST |
COST / PERIOD |
TIMES CRASHED |
ORDER |
CRASH COST |
A |
6 |
2 |
600 |
1400 |
200 |
0 |
0 |
|
B |
7 |
3 |
200 |
600 |
100 |
3 |
1ST, 2ND AND 4TH |
300 |
C |
9 |
6 |
500 |
950 |
150 |
1 |
4TH |
150 |
D |
2 |
1 |
800 |
1200 |
400 |
0 |
0 |
|
E |
8 |
5 |
1600 |
2800 |
400 |
0 |
0 |
|
F |
5 |
4 |
200 |
400 |
200 |
1 |
3RD |
200 |
G |
4 |
3 |
400 |
750 |
350 |
0 |
0 |
|
TOTAL COST |
4300 |
650 |
DIFFERENCE = 650
**SINCE NO OTHER DATA SUCH AS PENALTY COST OR DAILY COST OF THE PROJECT IS PROVIDED.
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