The management team for Buddy's Bats is considering two locations for a plant to manufacture wooden...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The management team for Buddy's Bats is considering two locations for a plant to manufacture wooden baseball bats. The plant will produce 500 bats per week. The fixed setup costs for both plants are identical. Plant A can produce 500 bats per week. The plant works one 8 hour shift per day with 5 staff. The plant works 5 days per week. The average wage is $25 per hour. The plant would use 600 units of maple and can buy maple at $5 per unit. Based on location and staffing levels, the plant would be assigned an overhead allocation of $1000 per week. Plant B can produce 500 bats per week. The plant works one 8 hour shift per day with 7 staff. The plant works 5 days per week. The average wage is $20 per hour. The plant would use 625 units of maple to make the bats and can buy maple at $4 per unit. Based on location and staffing levels, the plant would be assigned an overhead allocation of $1,500 per week. a) What is the total cost of production for a week at each plant? What is the cost per bat? What is the labour cost per bat? b) Calculate and compare the labour productivity of the two options. Which one is better? c) Calculate and compare the multi-factor (labour, input and overhead) productivity of the two options. Which location is preferred? d) Give two other factors that the management team should consider before choosing a location (there may be more than 2 but only 2 are required). e) Plant A's manager believes he can increase labour productivity by 10% by increasing wages to $26 per hour. How many bats can they now make in a week? What is the total labour cost per bat and total cost per bat? How much have each improved? The management team for Buddy's Bats is considering two locations for a plant to manufacture wooden baseball bats. The plant will produce 500 bats per week. The fixed setup costs for both plants are identical. Plant A can produce 500 bats per week. The plant works one 8 hour shift per day with 5 staff. The plant works 5 days per week. The average wage is $25 per hour. The plant would use 600 units of maple and can buy maple at $5 per unit. Based on location and staffing levels, the plant would be assigned an overhead allocation of $1000 per week. Plant B can produce 500 bats per week. The plant works one 8 hour shift per day with 7 staff. The plant works 5 days per week. The average wage is $20 per hour. The plant would use 625 units of maple to make the bats and can buy maple at $4 per unit. Based on location and staffing levels, the plant would be assigned an overhead allocation of $1,500 per week. a) What is the total cost of production for a week at each plant? What is the cost per bat? What is the labour cost per bat? b) Calculate and compare the labour productivity of the two options. Which one is better? c) Calculate and compare the multi-factor (labour, input and overhead) productivity of the two options. Which location is preferred? d) Give two other factors that the management team should consider before choosing a location (there may be more than 2 but only 2 are required). e) Plant A's manager believes he can increase labour productivity by 10% by increasing wages to $26 per hour. How many bats can they now make in a week? What is the total labour cost per bat and total cost per bat? How much have each improved?
Expert Answer:
Answer rating: 100% (QA)
Solution a Plant A Total cost of production Labour cost Input Cost Overhead cost 85255 6005 1000 900... View the full answer
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Posted Date:
Students also viewed these general management questions
-
A company is considering constructing a plant to manufacture a proposed new product. The land costs $300,000, the building costs $600,000, the equipment costs $250,000, and $100,000 additional...
-
A distribution company is considering two locations for the construction of a new automated warehouse: Chicago and Dallas. Two types of automation are also being considered: bar coding and RF/ID...
-
A process is designed to produce 500 units per hour with a scrap rate of 1% and inherent inefficiencies of 10%. Assuming that actual output is 425 units per hour, compute design capacity, available...
-
Compute the stone's average velocity over the time interval [0.5, 2.5] and indicate the corresponding secant line on a sketch of the graph of h(t). A stone is tossed vertically into the air from...
-
Should recognitions such as admission to the Hall of Fame be denied to athletes if steroid abuse is alleged but cannot be proven?
-
At what distance a should the bearing supports at A and B be placed so that the displacement at the center of the shaft is equal to the deflection at its ends? The bearings exert only vertical...
-
Do the following activities to complete your marketing plan: 1. Draw a simple organizational chart for your organization. 2. Develop a Gantt chart (see Chapter 2) to schedule the key activities...
-
The following information pertains to Mason Company for 2016: Beginning inventory ...... 90 units @ $40 Units purchased ........310 units @ $45 Ending inventory consisted of 30 units. Mason sold 370...
-
Briefly describe the two Oracle Administrative Tools and talk about some of their administration usage: -SQL*Plus - Oracle Enterprise Manager Database Express (EM Express) Question2: Explain briefly...
-
The file P02_07.xlsx includes data on 204 employees at the (fictional) company Beta Technologies. For this problem, consider this data set as the population frame. a. Using the method in this section...
-
Gripp Corporation needs $765,000 to pay one of its suppliers. The bank requires a compensating balance equal to 15 percent on loans to companies. Because Gripp currently holds no funds at the lending...
-
Write function called fancy_find. fancy_find should have #two parameters: search_within and search_for. # #fancy_find should check if search_for is found within the #string search_within. If it is,...
-
The guarantee of due process is the cornerstone of our Constitutional rights. All other Constitutional guarantees are maintained through the basic notions of due process. If you believe your...
-
A 15-year-old female appeared in front of a judge for her first offense, which was a misdemeanor assault charge against another student at her school. A 16- year-old male also appeared in front of...
-
A block of mass m=2 Kg is initially at rest at x=0 m on a horizontal frictionless surface. A horizontal force along the x-axis, F(x)= 4 + 3X2 where X is in m, is applied to the block. find the speed...
-
A firm has a cost of debt of 5.5 percent and a cost of equity of 14.7 percent. The debt-to-equity ratio is 1.17. There are no taxes. What is the firm's weighted average cost of capital?
-
Companys sales director:The $ 1 5 , 0 0 0 advertising expense relates to a television campaign overthe 2 0 2 4 New Year holiday and was aimed at increasing customerawareness of seedless dates totally...
-
g(x) = x 5 5x 6 a. Show that g(x) = 0 has a root, , between x = 1 and x = 2. b. Show that the equation g(x) = 0 can be written as x = (px + q) 1/r , where p, q and r are integers to be found. The...
-
The replacement of a planing machine is being considered by the Reardorn Furniture Company. (There is an indefinite future need for this type of machine.) The best challenger will cost $30,000 for...
-
To purchase a used automobile, you borrow $8,000 from Loan Shark Enterprises. They tell you the interest rate being charged is 1% per month for 35 months. They also charge you $200 for a credit...
-
Jerry Smith's residential air conditioning (AC) system has not been able to keep his house cool enough in 90F weather. He called his local AC I maintenance person, who discovered a leak in the...
-
Dalia owns a small public relations firm and wants to contract with her insurance provider to offer her employees the option to purchase short-term disability insurance. The insurance will pay out...
-
Distinguish between portfolio (capital) investment and direct investment.
-
What are performance requirements?
Study smarter with the SolutionInn App