Question 1 1you currently make a part on old equipment at a

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Reference no: EM13381603

Question 1
1. You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit. You have found an outside supplier who will make the part for $15 / unit if you will pay their annual fixed costs of $200,000 / year. The following table summarizes the details of this make versus buy decision.
ALTERNATIVE FIXED COST VARIABLE COST
Buy $200,000 per year $15 per unit
Make $50,000 per year $20 per unit

What is the break even quantity between buying and making?

30,000 units per year

40,000 units per year

50,000 units per year

60,000 units per year

Question 2
1. You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit. You have found an outside supplier who will make the part for $15 / unit if you will pay their annual fixed costs of $200,000 / year. The following table summarizes the details of this make versus buy decision.
ALTERNATIVE FIXED COST VARIABLE COST
Buy $200,000 per year $15 per unit
Make $50,000 per year $20 per unit

For what range of output would you prefer to buy?

0 - 30,000 units per year

30,000 or more units per year

40,000 or more units per year

0 - 40,000 units per year

Question 3

1. A company is considering making versus buying a part needed for manufacturing. Particulars are as follows:
Make: Fixed Costs = $9,000 / year Variable Cost / Unit = $2
Buy: Fixed Costs = $3,000 / year Variable Cost / Unit = $5
For an annual volume of 3,000 units, which supplier should be chosen?

Make

Buy

Either Make or Buy; costs are the same for either option at 3,000 units

Can't be determined with information given

Question 4

What does the company save for the year by selecting the low-cost option for annual requirements of 3,000 units? (Options are: make or buy)

$5,000

$1,000

$3,000

Can't be determined with information given

Question 5

1. A somewhat successful computer manufacturer makes a generic computer in five exciting colors. Once orders are received, the computer guts are encased in the customer's choice of colored case at the factory. This approach to production is known as:

channel assembly.

postponement.

strategic sourcing.

strategic production.

Question 6

1. The average inventory at Hamilton Industries, comprising raw materials, work-in-process, and finished goods, was found to be $17.2 million last year. If the cost of goods sold per week averaged $1.32 million, what was the inventory turnover experienced by Hamilton Industries? Assume the company had 50 working weeks per year.

Less than or equal to 3.50

Greater than 3.50 but less than 3.75

Greater than 3.75 but less than 4.00

Greater than 4.00

Question 7

1. Maple Leaf, Inc., a television manufacturer, would like to reduce its inventory. To this end, you are asked by the operations manager to assess its inventory level. You have the following information on average inventories from last year's financial statement:
Raw materials $2,500,000
Work-in-process $1,000,000
Finished goods $ 800,000
In addition, the cost of goods sold last year (50 weeks) was $15 million. What was the inventory turnover?

Less than or equal to two

Greater than two but less than three

Greater than three but less than four

Greater than four

Question 8

1. Shipments of Product Q from a plant to a wholesaler are made in lots of 400. The wholesaler's average demand for Q is 150 units per week. Lead time from plant to wholesaler is 5 weeks. The wholesaler pays for the shipments when they leave the plant. The plant has proposed several new lead time and lot size options to the wholesaler (see table below). If the wholesaler's goal is to minimize total cycle plus pipeline inventories, which option should the wholesaler select?

OPTION SHIPMENT LOT SIZE PLANT-TO- WHOLESALER LEAD TIME
CURRENT 400 5
1 500 4
2 800 3
3 1,000 2

option #1

option #2

option #3

remain with the current option

Question 9

1. Shipments of Product A from a distribution center to a retailer are made in lots of 350. The retailer's average demand for A is 75 units per week. Lead time from distributor to retailer is 3 weeks. The retailer pays for the shipments when they leave the distributor. The distributor has agreed to reduce the lead time to 2 weeks if the retailer will purchase quantities of 400 per shipment instead of 350.

With the change in purchased quantities, the average cycle inventory will:

Decrease by 75 units.

Increase by 50 units.

Decrease by 25 units.

Increase by 25 units.

Question 10

With the change in lead times, the pipeline inventory will:

Decrease by 75 units.

Increase by 50 units.

Decrease by 25 units.

Increase by 25 units.

Attachment:- Assignment.rar

Reference no: EM13381603

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