Question

In: Accounting

A manager must decide which type of machine to buy, A, B, or C. Machine costs...

A manager must decide which type of machine to buy, A, B, or C. Machine costs (per individual machine) are as follows:

Machine Cost

A $ 60,000

B $ 50,000

C $ 60,000 Product forecasts and processing times on the machines are as follows:

PROCCESSING TIME PER UNIT (minutes) Product Annual Demand

Product Annual Demand Processing time per unti (minutes)

A B C

1 25,000 1 1 5

2 14,000 1 6 3

3 20,000 1 3 4

4 6,000 6 4 2

a. Assume that only purchasing costs are being considered. Compute the total processing time required for each machine type to meet demand, how many of each machine type would be needed, and the resulting total purchasing cost for each machine type. The machines will operate 8 hours a day, 250 days a year. (Enter total processing times as whole numbers. Round up machine quantities to the next higher whole number. Compute total purchasing costs using these rounded machine quantities. Enter the resulting total purchasing cost as a whole number.

Omit the "$" sign.) Total processing time in minutes per machine: A B C Number of each machine needed and total purchasing cost A $ B $ C $ b. Consider this additional information: The machines differ in terms of hourly operating costs: The A machines have an hourly operating cost of $15 each, B machines have an hourly operating cost of $12 each, and C machines have an hourly operating cost of $14 each. What would be the total cost associated with each machine option, including both the initial purchasing cost and the annual operating cost incurred to satisfy demand?(Use rounded machine quantities from Part a. Do not round any other intermediate calculations. Round your final answers to the nearest whole number. Omit the "$" sign.) Total cost for each machine A B C This is the last question in the assignment. To submit, use Alt + S. To access other questions, proceed to the question map button.Next Visit question mapQuestion 5 of 5 Total5 of 5 Prev

Expert Solution

ekkarill92 answered 2 years ago

Problem 2 A manager must decide how many machines of a certain type to buy. The...

Problem 2 A manager must decide how many machines of a certain type to buy. The machines will be used to manufacture a new gear for which there is increased demand. The manager has narrowed the decision to two alternatives: buy one machine or buy two. If only one machine is purchased and demand is more than it can handle, a second machine can be purchased at a later time. However, the cost per machine would be lower if the...

A manager must decide how many machines of a certain type to purchase. Each machine can...

A manager must decide how many machines of a certain type to purchase. Each machine can process 101 customers per day. One machine will result in a fixed cost of $2,038 per day, while two machines will result in a fixed cost of $3,836 per day. Variable cost will be $22 per customer and revenue will be $49 per customer. Determine the break-even point in units for TWO machines. *Round your answers to 3 decimal places in your calculation if...

Maplewood Company must decide whether to make or buy some of its components. The costs of...

Maplewood Company must decide whether to make or buy some of its components. The costs of producing 59,600 switches for its generators are as follows. Direct materials $30,396 Variable overhead $47,680 Direct labour 42,912 Fixed overhead 57,216 Instead of making the switches at an average cost of $2.99 ($178,204 ÷ 59,600), the company has an opportunity to buy the switches at $2.79 per unit. If the company purchases the switches, all the variable costs and one-third of the fixed costs...

Wilma Company must decide whether to make or buy some of its components. The costs of...

Wilma Company must decide whether to make or buy some of its components. The costs of producing 60,200 switches for its generators are as follows. Direct materials $29,900 Variable overhead $45,700 Direct labor $25,990 Fixed overhead $76,000 Instead of making the switches at an average cost of $2.95 ($177,590 ÷ 60,200), the company has an opportunity to buy the switches at $2.67 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs...

Oriole Company must decide whether to make or buy some of its components. The costs of...

Oriole Company must decide whether to make or buy some of its components. The costs of producing 60,200 switches for its generators are as follows. Direct materials $29,900 Variable overhead $45,700 Direct labor $25,990 Fixed overhead $76,000 Instead of making the switches at an average cost of $2.95 ($177,590 ÷ 60,200), the company has an opportunity to buy the switches at $2.67 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs...

Wildhorse Company must decide whether to make or buy some of its components. The costs of...

Wildhorse Company must decide whether to make or buy some of its components. The costs of producing 68,900 switches for its generators are as follows. Direct materials $30,200 Variable overhead $44,600 Direct labor $46,455 Fixed overhead $82,000 Instead of making the switches at an average cost of $2.95 ($203,255 ÷ 68,900), the company has an opportunity to buy the switches at $2.66 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs...

1. Wilma Company must decide whether to make or buy some of its components. The costs...

1. Wilma Company must decide whether to make or buy some of its components. The costs of producing $ 63,000 switches for its generators are as follows: Direct Materials------ $ 29300 Variable Overhead-------- $ 44200 Direct Labor--------- $ 30,634 Fixed Overhead--------- $ 82800 Instead of making the switches at an average costs of $ 2.93 ( $ 186,934/ 63, 800), the company has an opportunity to buy the switches at $ 2.74 per unit. If the company purchases the switches,...

QUESTION 4: (a) The Workshop Manager must decide the sequence in which the four vehicles in...

QUESTION 4: (a) The Workshop Manager must decide the sequence in which the four vehicles in the workshop must be serviced. He has developed these estimates based on the First-Come-First-Served sequence rule: Vehicle ID Number Estimated Maintenance Time (days) Time to Promised Delivery (days) FCFS Order Sequence 226 27 39 1 229 33 30 2 224 41 60 3 225 29 75 4 Rank the FCFS, SPT and CR sequencing rules on three evaluation criteria: average flow time, average number...

30. Which type of manager would be allowed to decide whether or not new manufacturing equipment...

30. Which type of manager would be allowed to decide whether or not new manufacturing equipment should be purchased? a. Production manager b. Cost center manager c. Profit center manager d. Investment center manager 15. In the decision-making process, which of the following tactical decision making situations would be best addressed by managers using a segmented income statement rather than a contribution margin format income statement? a. The decision on whether or not a one-time special order for a customer...

Question MUST be answered in EXCEL A bank manager must decide whether or not to hire...

Question MUST be answered in EXCEL A bank manager must decide whether or not to hire additional tellers. His decision will depend partly upon how long it takes to complete customer transactions. The null hypothesis is that the mean transaction completion time, , is at most 40 seconds. The population standard deviation is assumed to be 10 seconds. If the null is rejected, new tellers will be hired. A sample of 50 transactions was obtained with a mean of 37.5...