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

Propose an ordering policy, Bookstore buys a popular freshman physics book ...

Bookstore buys a popular freshman physics book at $30 each and sells it to students at $50 each.  The same book is used for Fall and Winter terms.  The demand for books is distribu

Traditional approach, compare between traditional and value driven approach...

compare between traditional and value driven approach

Discuss managers for a large retail department store, Recently the managers...

Recently the managers for a large retail department store stated that a study has revealed that female shoppers spend on average 23.5 minutes longer in the store per visit than do

Explain measuring the impact of a capital acquisition, Measuring the impact...

Measuring the impact of a capital acquisition on productivity is an example of multifactor productivity.

Location, What are potential advantages and disadvantage of locating a prod...

What are potential advantages and disadvantage of locating a production facility in foreign country instead of using domestic location?

Different roles that need to be performed by team members, Question : (...

Question : (a) "When a team is performing at its best, you'll usually find that each team member has clear responsibilities. You'll also see that every role needed to achieve t

Explain low customer contact and are capital intensive, What are companies ...

What are companies that have low customer contact and are capital intensive; yet provide a service, called?

Explain how cultural differences may impact communication, Describe in deta...

Describe in detail how cultural differences may impact communication. Give examples. What can be done to improve communication across cultures?

Explain about the organization and its resources, 1. How to characterize yo...

1. How to characterize your supervisor's approach to management? For example, which particular management tasks and roles does this person perform most often? What kinds of managem

Explain is herzog a partner in the a1a car wash business, White, Fring, and...

White, Fring, and Pinkman are partners in the operation of the A1A car wash. Without Fring's knowledge, White and Pinkman sold 10 percent of their interest in the business and its

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