Determine the utilization and the efficiency

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1. Determine the utilization and the efficiency for each of these situations:

(a) A loan processing operation that processes an average of 6 loans per day. The operation has a design capacity of 10 loans per day and an effective capacity of 8 loans per day.

(b) A furnace repair team that services an average of four furnaces a day if the design capacity is six furnaces a day and the effective capacity is five furnaces a day. [Hint: Please read Example 1 on page 189 in the text book.] Please solve the following problem related to cost-volume analysis

2. A producer of pens has fixed costs of $36,000 per month which are allocated to the operation and variable costs are $0.80 per pen.

(a) Find the break-even quantity if pens sell at $2.0 each.

(b) Find the profit if the company produces 35,000 pens and pens sell at $2.0 each?

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Reference no: EM132087816

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