Explain crossover point among the existing process, Operation Management

Assignment Help:

The local convenience store makes personal pan pizzas. Currently, their process makes complete pizzas, fully cooked, for the customer. This process has a fixed cost of $20,000, and a variable cost of $2.00 per pizza. The owner is considering a different process that can make pizzas in two ways: completely cooked (as before), or partially cooked and then flash frozen, for the customer to finish at home. This alternate process has a fixed cost of $24,000, but a lower variable cost (because much less energy is used in baking) of $1.50 per pizza.

a. What is the crossover point between the existing process and the proposed process?

b. If the owner expects to sell 9,000 pizzas, should he get the new oven?


Related Discussions:- Explain crossover point among the existing process

Explain what is the role of participation in goal setting, What is the role...

What is the role of participation in goal setting? Answer Participation is positively correlated with performance Participation provides more goal clarity Participation

Location decisions, the globalization and geographic dispersion of operatio...

the globalization and geographic dispersion of operations

Plant location, factor relating methods for locating a plant

factor relating methods for locating a plant

Explain percentage must materials cost be reduced, Merk, Inc., produces ele...

Merk, Inc., produces electronics component on an assembly line. The standard cost for the component is $105 (labor $15, materials $60, and other costs $30). The sellings price is $

Human Resource, 1. What in your view are the central human resources issues...

1. What in your view are the central human resources issues involved in this case?

Explain the scope of an external customers project, Project sponsors within...

Project sponsors within the contractors company have the authority to change the scope of an external customers project as they see fit. Answer Have the authority to change t

Explain variations in the material characteristics, Rivets used to secure t...

Rivets used to secure the stainless steel sheet metal of aircraft wings are designed to withstand certain shearing forces. It is known that because of random variations in location

Location Strategies, What are the CSF''s in making location decisions

What are the CSF''s in making location decisions

What is benchmark for future comparison, Cunningham Performance Auto, Inc.,...

Cunningham Performance Auto, Inc., modifies 375 autos per year. The manager, Peter Cunningham, is interested in obtaining a measure of overall performance. He has asked you to prov

Explain keeping your personal customer data the cloud, Some companies run t...

Some companies run their entire business by offering cloud services called Software as a Service (SaaS). There are several advantages for companies and individuals to use SaaS. But

Write Your Message!

Captcha
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