In: Accounting
The Electro-Poly Corporation is the world’s leading manufacturer
of slip rings. A
slip ring is an electrical coupling device that allows current to
pass through a spinning or rotating connection—such as a gun turret
on a ship, aircraft, or tank. The
company recently received a $750,000 order for various quantities
of three types of
slip rings. Each slip ring requires a certain amount of time to
wire and harness. The
following table summarizes the requirements for the three models of
slip rings.
Model 1 Model 2 Model 3
Number Ordered 3,000 2,000 900
Hours of Wiring Required per Unit 2 1.5 3
Hours of Harnessing Required per Unit 1 2 1
Unfortunately, Electro-Poly does not have enough wiring and
harnessing capacity to
fill the order by its due date. The company has only 10,000 hours
of wiring capacity
and 5,000 hours of harnessing capacity available to devote to this
order. However,
the company can subcontract any portion of this order to one of its
competitors. The
unit costs of producing each model in-house and buying the finished
products from
a competitor are summarized below.
Model 1 Model 2 Model 3
Cost to Make $50 $83 $130
Cost to Buy $61 $97 $145
Electro-Poly wants to determine the number of slip rings to make
and the number to
buy to fill the customer order at the least possible cost.
CAN YOU PLEASE MAKE A DIFFERENT QUESTION LIKE THIS METHOD AND SOLVE IT ON EXCEL