Determine each alternative break-even point in units

Assignment Help Operation Management
Reference no: EM132284887

A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two alternatives, A and B, have been identified, and the associated costs and revenues have been estimated. Annual fixed costs would be $36,000 for A and $31,000 for B; variable costs per unit would be $7 for A and $11 for B; and revenue per unit would be $17.

a. Determine each alternative’s break-even point in units. (Round your answer to the nearest whole amount.) QBEP,A units QBEP,B units

b. At what volume of output would the two alternatives yield the same profit? (Round your answer to the nearest whole amount.) Profit units

c. If expected annual demand is 14,000 units, which alternative would yield the higher profit? Higher profit.

Reference no: EM132284887

Questions Cloud

?what is the best estimate of the current stock price : The dividends are then expected to grow at a 6% rate forever. The required return (rs) is 12%. ?What is the best estimate of the current stock price?
What is the required rate of return on bayway : What is the required rate of return on Bayway Inc's stock? Round your answer to two decimal places.
Acquire to satisfy predicted demand under these conditions : How many cells should the company plan to acquire to satisfy predicted demand under these conditions?
What is the portfolio beta : You invest $30,000 in a stock with a beta of 1.5. What is the portfolio's beta?
Determine each alternative break-even point in units : Determine each alternative’s break-even point in units. At what volume of output would the two alternatives yield the same profit?
Beneficial in inter-bank transactions : Given the Volatility of FX currencies (20%) and high costs of transactions, commissions and bank fees in transferring money (15%) can Bitcoin
Business process for damage compensation : Model the control flow of the following business process for damage compensation.
Decision of purchasing product or making the product : What is the optimal production quantity (EPQ). What is the optimal order quantity (EOQ)?. Do you make the product or purchase it and why?
Create portfolio with an expected return : Your goal is to create portfolio with an expected return of 12.5 percent. All money must be invested. How much will you invest in Stock X?

Reviews

Write a Review

Operation Management Questions & Answers

  Book review - the goal

Operations Management is about a book review. Title of the book is "Goal". This book has been written by Dr. Eliyahu Goldartt. The book has been appreciated by many as one of those books which offers an insight into the operations and strategic capac..

  Operational plan in hospitality enterprise

Operational plan pertaining to a hospitality enterprise is given in detail in the solution. The operational plan is an important plan or preparation which gives guidelines regarding the role and responsibilities of each and every operation at all lev..

  Managing operations and information

Recognise the importance of a strategic approach to the development and deployment of organisational information systems. Demonstrate an understanding of the importance of databases and their integration to the organisation's overall information mana..

  A make-or-buy analysis

An analysis of the holding costs, including the appropriate annual holding cost rate.

  Evolution and contributor of operations management

Briefly explain Evolution and contributor of Operations management.

  Functions and responsibilities of an operations manager

A number of drivers of change have transformed the roles, functions and responsibilities of an operations manager over recent years. These drivers have not only been based on technological innovations but also on the need for organisations to develop..

  Compute the optimal order quantity

Compute the Optimal Order quantity of DVD players. Determine the appropriate reorder point.

  Relationship to operations practice in the organisation

Evaluate problems in operations and identify approaches to overcoming them. Critically evaluate operating plans and identify areas for improvement. Justify, implement and evaluate changes to operations in line with modern approaches.

  A make or buy analysis

Develop a report for Figi Fabricating that will address the question of whether the company should continue to purchase the part from the supplier or begin to produce the part itself.

  Prepare a staffing plan

Prepare a staffing plan showing the change of your unit from medical/surgical staffing to oncology staffing.

  Leadership styles in different organizations

Ccompare the effectiveness of different leadership styles in different organizations

  Risk management tools and models

Be able to understand the concept of risk, roles and responsibilities for risk management and risk management tools and models.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd