A manager is going to purchase new processing equipment and must decide on the number of spare
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If a part fails and a spare is not available, two days will be needed to obtain a replacement and install it. The cost for idle equipment is $ 500 per day. What quantity of spares should be ordered?
a. Use the ratio method.
b. Use the tabular method.
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...
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Given Spares cost 200 each Unused spares have a salvage value of 50 each If a part fails and a spare ...View the full answer
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