Question

In: Accounting

AlwaysRain Irrigation, Inc. would like to determine capacity requirements for the next four years. Currently, two...

AlwaysRain Irrigation, Inc. would like to determine capacity requirements for the next four years. Currently, two production lines are in place for making bronze and plastic sprinklers. Three types of sprinklers are available in both bronze and plastic: 90-degree nozzle sprinklers, 180-degree nozzle sprinklers, and 360-degree nozzle sprinklers. Management has forecast demand for the next four years as follows:

YEARLY DEMAND
1 (IN 000s) 2 (IN 000s) 3 (IN 000s) 4 (IN 000s)
Plastic 90 31 40 52 53
Plastic 180 14 16 17 14
Plastic 360 52 52 63 65
Bronze 90 6 6 5 15
Bronze 180 2 2 5 13
Bronze 360 10 12 11 22


Both production lines can produce all the different types of nozzles. The bronze machines needed for the bronze sprinklers require three operators and can produce up to 18,000 sprinklers. The plastic injection molding machine needed for the plastic sprinklers requires four operators and can produce up to 300,000 sprinklers. Three bronze machines and only one injection molding machine are available.

What are the capacity requirements for the next four years? (Assume that there is no learning.) (Enter the demand values in thousands. Round your answers to 2 decimal places.)


Solutions

Expert Solution

ANSWER

BRONZE MACHINES

Productions

18,000 Units

Total Bronze Machines

3

Lines

2

Total Bronze units available for year(18000*3*2)

108,000

Bronze capacity throughout four years(108,000*4)

432,000

Therefor Bronze machine cannot meet the total requirement(90,000+180,000+360,000)=630,000)

PLASTIC MACHINES

Productions

300,000

Total injection machine

1

Lines

2

Total plastic units available for year(300,000*1*2)

600,000

Plastic capacity throughout four years(600,000*4)

2,400,000

Demand is same as above in bronze(630,000)

YEAR 1

YEAR 2

YEAR 3

YEAR 4

PLASTIC

Plastic 90

31

40

52

53

Plastic 180

14

16

17

14

Plastic 360

52

52

63

65

Total demand for plastic

97

108

132

132

Percentage of capacity used(per 300000)

32.33

36

44

44

Machine requirement(NO. of Machine 1)

0.323

0.36

0.44

0.44

Labor requirement(4 operators)

1.292

(0.323*4)

1.44

(0.36*4)

1.76

(0.44*4)

1.76

(0.44*4)

YEAR 1

YEAR 2

YEAR 3

YEAR 4

BRONZE

Bronze 90

6

6

5

15

Bronze 180

2

2

5

13

Bronze 360

10

12

11

22

Total demand for bronze

18

20

21

50

Percentage of capacity used(18000*3=54000)

33.33

37.03

38.88

93

Machine requirement(no. of machine 3)

0.999

1.1109

1.1664

2.79

Labor requirement(no. of operators 3)

2.997

(0.999*3)

3.3327

(1.1109*3)

3.4992

(1.1664*3)

8.37

(2.79*3)


Related Solutions

AlwaysRain Irrigation, Inc., would like to determine capacity requirements for the next four years. Currently two...
AlwaysRain Irrigation, Inc., would like to determine capacity requirements for the next four years. Currently two production lines are in place for making bronze and plastic sprinklers. Three types of sprinklers are available in both bronze and plastic: 90-degree nozzle sprinklers, 180-degree nozzle sprinklers, and 360-degree nozzle sprinklers. Management has forecast demand for the next four years as follows: YEARLY DEMAND 1 (IN 000s) 2 (IN 000s) 3 (IN 000s) 4 (IN 000s) Plastic 90 31 40 52 53 Plastic...
Coco cola Inc., would like to determine capacity requirement for the next four years. Currently two...
Coco cola Inc., would like to determine capacity requirement for the next four years. Currently two production lines are in place for making Coco Cola and Sprite. Three types of machines are available for Bottle and Cans: 80ml, 170ml and 350ml. Management has forecast demand for the next four years as follows: YEARLY DEMAND 1(IN 000s) 2(IN 000s) 3(IN 000s) 4(IN 000s) Bottle 80 Bottle 170 Bottle 350 Cans 80 Cans 170 Cans 350 320 150 500 70 30 110...
The Chewy Candy Company would like to determine an aggregate production plan for the next six...
The Chewy Candy Company would like to determine an aggregate production plan for the next six months. The company makes many different types of candy but feels it can plan its total production in pounds provided that the mix of candy sold does not change too drastically. At the present time, the Chewy Company has 70 workers and 9000 pounds of candy in inventory. Each worker can produce 100 pounds of candy a month and is paid $19 an hour...
You plan on working for the next 35 years before retiring and you would like to...
You plan on working for the next 35 years before retiring and you would like to accumulate $2 million when you stop working. If you start today, how much will you deposit each month to reach $2 million in retirement? Assume you will average a 7% annual rate of return in deposits will be made at the end of each month.
You will receive annual payments of $15,000 for the next 25 years. You would like to...
You will receive annual payments of $15,000 for the next 25 years. You would like to have your money today instead of waiting of waiting 25 years to receive it all. What is the equivalent value of this future stream of payments if the appropriate discount rate is 8%? A. 148,421.91 B. 160,121.64 C. 183,926.48 D. 201,448.72
A stock price is currently $130. Over each of the next two four-month periods it is...
A stock price is currently $130. Over each of the next two four-month periods it is expected to go up by 15% or down by 10%. The risk-free interest rate is 8% per annum with continuous compounding. (All calculations keep four digits after the decimal point) 1. What is the value of an eight-month European call option with a strike price of $133? 2. What is the value of an eight-month American put option with a strike price of $133?
Your investment account is expected to earn a 5% return for next two years and then 8% return for next four years after that.
a. Your investment account is expected to earn a 5% return for next two years and then 8% return for next four years after that. You need to withdraw $750 from this account at the end of each month for next six years. After last withdrawal at end of six years, nothing remains in your account. how much is deposited in this account today? (Assume monthly compounding)b. You just bought a condo for $250,000 and paid $50,000 as down payment....
A tenant would like to lease 4,000 square feet of space over the next ten years,...
A tenant would like to lease 4,000 square feet of space over the next ten years, and is evaluating the following alternatives: 1: Gross lease with base rent of $16 psf each year.    2: Gross lease with base rent of $15 psf with rent rising by $0.50 psf every other year; the first year of adjustment is year 3. 3: Absolutely net lease with base rent of $12 psf, increasing to $14 psf starting in year 6.         expenses...
A stock price is currently $30. During each two-month period for the next four months it...
A stock price is currently $30. During each two-month period for the next four months it will increase by 8% or decrease by 10%. The risk-free interest rate is 4%. Use a two-step tree to calculate the value of a derivative that pays off [max(30-ST, 0)]2, where ST is the stock price in four months. If the derivative is American-style, should it be exercised early?
If you would like to accumulate 7,500 over the next 5 years, how much must you...
If you would like to accumulate 7,500 over the next 5 years, how much must you deposit each six months, starting from now given a 6 percent rate and semi-annually compunding? A. How much must you deposit each six months?
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT