NEW NUMBERS Andre Greipel is the owner of a small company that produces heart rate monitors....

NEW NUMBERS

Andre Greipel is the owner of a small company that produces heart rate monitors. The annual demand is for 2,250 heart rate monitors, and Andre produces these devices in batches. On average, Andre can produce 140 monitors per day during the production process. Demand for monitors has been about 35 monitors per day. The cost to set up the production process is $350, and it costs Andre $0.80 to carry 1 monitor in inventory for one year. How many monitors should Andre produce in each batch?

a) What is the optimal economic production quantity?

b) On average, how many setups are required per year (one decimal place)?

c) What is the total cost per year (holding plus setup)?

Solutions

Expert Solution

Colby Messinger answered 1 year ago

Next > < Previous

Related Solutions

M7_IND4. Andre Greipel is the owner of a small company that produces heart rate monitors. The...

M7_IND4. Andre Greipel is the owner of a small company that produces heart rate monitors. The annual demand is for 2,250 heart rate monitors, and Andre produces these devices in batches. On average, Andre can produce 140 monitors per day during the production process. Demand for monitors has been about 35 monitors per day. The cost to set up the production process is $350, and it costs Andre $0.80 to carry 1 monitor in inventory for one year. How many...

assume you are the owner of a small company that produces a line of barbeque grills....

assume you are the owner of a small company that produces a line of barbeque grills. describe how you could use social media to connect with customers, improve customer service,increase sales, and reduce expenses.

You are the owner of a company that produces and sells a new tool at hardware...

You are the owner of a company that produces and sells a new tool at hardware stores. During one month, when 'x' of those new tools were produced and sold, the following were the revenue and cost (in hundreds of dollars). R(x)= -0.06x2 +13.12x + 65.8 C(x)=3.04x+ 7.6 5.Fill-in the blanks.Be sure to read the following carefully! HINT: do NOT use the TABLE from your graphing calculator, but DO use the graphing capabilities. a)The profit for that month was 79...

Rainbow Company produces two types of monitors – regular and multifunction. The company has produced the...

Rainbow Company produces two types of monitors – regular and multifunction. The company has produced the regular monitor for years whereas the multifunction monitor was introduced in the year 2016 to exploit the military vessels market. However, since the introduction of the new monitor, the company’s profitability has not increased as expected. Therefore, the management has particularly focused its attention on the company’s costing method. The existing costing method allocates the company’s production support costs to the two products on...

You are the controller of the Small Corporation. Terry Small, the company owner, asked you why...

You are the controller of the Small Corporation. Terry Small, the company owner, asked you why you recorded Goodwill as an asset on the books when Small purchased another company. How do you respond?

The owner of a small company asked a CPA to conduct an audit of the company's...

The owner of a small company asked a CPA to conduct an audit of the company's records. The owner of the company told the CPA that the audit was to be completed in time to submit audited financial statements to a bank as part of a loan application. The CPA immediately accepted the engagement and agreed to provide an auditor's report within three weeks. The owner agreed to pay the CPA a fixed fee plus a bonus if the load...

The owner of a small company asked a CPA to conduct an audit of the company's...

Cost Assignment and JIT Bunker Company produces two types of glucose monitors (basic and advanced). Both...

Cost Assignment and JIT Bunker Company produces two types of glucose monitors (basic and advanced). Both pass through two producing departments: Fabrication and Assembly. Bunker also has an Inspection Department that is responsible for testing monitors to ensure that they perform within prespecified tolerance ranges (a sampling procedure is used). Budgeted data for the three departments are as follows: Inspection Fabrication Assembly Overhead $160,000 $240,000 $68,000 Number of tests — 10,000 30,000 Direct labor hours — 24,000 12,000 In the...

Cost Assignment and JIT Bunker Company produces two types of glucose monitors (basic and advanced). Both...

Cost Assignment and JIT Bunker Company produces two types of glucose monitors (basic and advanced). Both pass through two producing departments: Fabrication and Assembly. Bunker also has an Inspection Department that is responsible for testing monitors to ensure that they perform within prespecified tolerance ranges (a sampling procedure is used). Budgeted data for the three departments are as follows: Inspection Fabrication Assembly Overhead $640,000 $960,000 $272,000 Number of tests — 40,000 120,000 Direct labor hours — 96,000 48,000 In the...

Ray, the owner of a small company, asked Holmes, a CPA, to conduct an audit of...

Ray, the owner of a small company, asked Holmes, a CPA, to conduct an audit of the company’s records. Ray told Holmes that an audit was to be completed in time to submit audited financial statements to a bank as part of a loan application. Holmes immediately accepted the engagement and agreed to provide an auditor’s report within three weeks. Ray agreed to pay Holmes a fixed fee plus a bonus if the loan was granted. Holmes hired two accounting...

Subjects