Identified the options for obtaining machined part

Assignment Help Operation Management

Reference no: EM131758865

Suppose that a manufacturer has identified the following options for obtaining a machined part. It can buy the part at $200 per unit (including materials); it can make the part on a numerically controlled semiautomatic lathe at $75 per unit (including materials); or it can make the part on a machine center at $15 per unit (including materials). There is negligible fixed cost if the item is purchased; a semiautomatic lathe costs $80,000; and a machining center costs $200,000. The part is sold at the price of $300 each.

(Show work in Excel)

a. What is the breakeven point for the numerically controlled semi-automatic lathe?

b. What is the breakeven point for the machine center?

Compute the total revenue, total cost, and total profit for each of the 3 options when Q = 500

Over what range of demand level (Q) will the buy option be best; the make on semiautomatic lathe be best; make on machine center be best?

Reference no: EM131758865

Questions Cloud

What is macy organizational structure : What is Macy's organizational structure? Is it an organic structure or mechanistic structure conpany? Why?

Addition of new factory to absorb the backlog of demand : A producer of pottery is considering an addition of a new factory to absorb the backlog of demand

Policies pertaining to subpoena on relaease of information : Compare at least two policies pertaining to a subpoena on Relaease of information (ROI) then summarize the two.

Evaluate jobs in term of interpersonal style : How would you evaluate Jobs in term of interpersonal style--traditional, participative, and individualistic?

Identified the options for obtaining machined part : Suppose that a manufacturer has identified the following options for obtaining a machined part.

Process varies by purchase for each individual : The consumer decision process varies by purchase for each individual.

Communicate an impending company-wide layoff : What communication channel would you choose to communicate an impending company-wide layoff?

Do you think job personality influenced apple employees : Do you think Job's personality influenced Apple employees in a positive or negative way?

Primary sales representative for ibm calling : You are the primary sales representative for IBM calling on your university and are responsible for finalizing the sale of 20 new network servers.

User Account

All Pages