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for the three how do you get e ROBLEMS design capacity of to loans per day and a

ID: 3053783 • Letter: F

Question

for the three how do you get e

ROBLEMS design capacity of to loans per day and an elle average of four furnaces a day if the desi h A fumace repair team that services arn e capacity is five furnaces a day will always fumavs a day and the effectiv have higher utilization ratios than those other systems? Explairn. 2 In a job sho effective capacity is only 50 percent of design capacity, and actual outoun 9 s: Would you say that systems that have higher efficiency ratios than other systen an actual S0 percent of effective outpat. What design capacity would be needed to achieve eight jobs per week? s A pruucer of pottery is considering the addition of a new plant to absorb the backl that now exists The primary location being considered will have fixed costs of $9.0n and variable costs of 70 cents per unit produced. Each item is sold to retailers at a averages 90 cents. 0 What volume per month is required in order to break even? h What profit would be realized on a monthly volume of 61,000 units? 87,000 units? c. What volume is needed to obtain a profit of $16.000 per month? d. What volume is needed to provide a revenue of $23.000 per month? e. Plot the total cost and total revenue lines, 4 A small firm intends to increase the capacity of a bottleneck operation by adding a new machin Two alternatives, A and B, have been identified, and the associated costs and revenues have ben estimated. Annual fixed costs would be $40,000 for A and $30,000 for B: variable costs per u would be S10 for A and S1I for B: and revenue per unit would be $15. a. Determine each alternative's break-even point in units. b. At what volume of output would the two alternatives yield the same profit? c. If expected annual demand is 12,000 units, which alternative would yield the higher proum

Explanation / Answer

Question 2 -

Effective capacity = 0.50 * Design capacity ----- Eq1

Actual output = 0.80 * Effective capacity ----- Eq2
Acutal output desired = 8 jobs per week

Substiting Eq1 in Eq2

Actual output = 0.80 * (0.50*Design capcity)
Actual output = 0.40 * ( Design capcity)

There we have

Design Capacity = Actual output / 0.40

But we know acutal output is 8

Design capacity = 8/0.40 = 20 jobs