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Consideration for constructing a second headquarters

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Reference no: EM132041511

Please identify the important variables and steps to solve.

1. A job had an observed cycle time of three min., a performance rating of 70 percent, and an allowance factor that was 20 percent of job time. Normal time for the job in min. is:

2. A job had an observed time of 8 minutes, a performance rating of .80, and an allowance factor of 15 percent of job time. Twenty cycles were timed. Standard time for the job in minutes is:

3. Amazing, an internet-based retailer, has two different locations under consideration for constructing a second headquarters. The CEO estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, as follows:

Location Annual Fixed Variable

East Ave. $250,000 $5

West Dr. $300,000 $4.5

What would be total annual costs for either location at the point of indifference?

Reference no: EM132041511

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