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 the required return increases, Which of the following changes will ...

Which of the following changes will make the value of a stock go up, other things being held constant? Answer a. The required return decreases. b. The required return increases.

Explain what is the primary reason people buy, What Is The Primary Reason P...

What Is The Primary Reason People Buy And Own Major Appliance Such As Washing Machine. Is there a secondary reason as well?

Activities and types of scheduling, Activities and Types of Scheduling ...

Activities and Types of Scheduling Scheduling includes the followings activities 1. Allocation of quality and rate of output of the plant or department. And 2. Allocation

Explain how much repayment of principal, Jan sold her house on December 31 ...

Jan sold her house on December 31 and took a $50,000 mortgage as part of the payment. The 10-year mortgage has a 11% nominal interest rate, but it calls for semiannual payments beg

Explain risks identified in the project charter, Risks identified in the pr...

Risks identified in the project charter include events that if they occur will have either a positive or a negative effect on a project's objectives.

What are disadvantages of holding inventory control system, What are the di...

What are the disadvantages of holding inventory control systems? Disadvantages of holding inventory control systems: a. Higher risk of damage, theft and deterioration b.

Thus the best decision isn''t always made, As a manager, you are expected t...

As a manager, you are expected to make logical, rational decisions that are in the best interests of the organization. However, the best decision isn't always made. Let's discuss w

Describe the main sources of destructive fires, Identify and explain the ma...

Identify and explain the main sources of destructive fires and associated preventive measures.

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