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You run a small shop that makes widgets. You employ 50 workers, and each worker can make 2 widgets per hour. They work for 8 hours a day and 20 days in a month.
You are quite concerned that you now have a big order of 64,000 widgets next month and want to hire some temps to make all 64,000 widgets next month. So, you'll have the extra labor start on the first and work the normal 20 days. Assume that these people can just arrive and get going making widgets like the normal staff.You pay the normal staff 25.00 an hour (don't worry about taxes and stuff). You'll pay Temp Agency 15.00 an hour for each temp hire. So, now you've got to budget for this stuff.So here goes:
1. How many widgets can the current staff produce each month?
2. How many temps do you need to hire to produce 64,000 widgets next month?
3. What's the total payroll for the next month going to be which includes the temp hires?
Suppose that AlwaysRain Irrigations marketing department will undertake an intense ad campaign for the bronze sprinklers, which are more expensive but also more durable than the plastic ones.
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Specify as a whole number by rounding. Do not round the EOQ that you obtain in the process of determining the number of orders.
Also calculate the overall return on investment of the project and then present a break-even analysis. At what point does break-even occur?
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