You have your own company, the EIE0120, a LLC. This company produces stamped metal parts. You...

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You have your own company, the EIE0120, a LLC. This company produces stamped metal parts. You have been asked by a current customer to provide a quotation for a product that is similar to but different in size to products the company currently makes. You have been asked to determine the price for a product that is 20 in by 30 in. You have discussed this with your IE, and the IE has agreed to prepare this quote. The IE has collected data from similar orders that have been produced in the past. Size Sq In Std Time LCR 12 x 12 144 1.97 min 97% 12 x 20 240 3.27 86 16 x 16 256 2.43 93% 16 x 20 320 3.74 88 20 x 20 400 5.46 91 20 x 25 500 6.14 94 The IE believes that regression and LCR techniques will be useful in preparing the quote. The learning curve rate (LCR) applies only to the first 500 units. The company feels no learning takes place after 500 units. The sizes refer to rectangular steel pieces that have various operations to produce the finished product. The number of operations is a function of the size of the product. The steel pieces are 0.0625 inches thick. Steel is purchased in rolls that are 35 inches wide. Steel costs $0.475 per pound. Accounting tells you that the direct labor rate is $18.73 per hour, and the direct labor overhead rate is 49%. The labor variance is 21%. The indirect variable manufacturing expense is 329% of direct labor. Fixed costs are 29% of manufacturing costs. You have your own company, the EIE0120, a LLC. This company produces stamped metal parts. You have been asked by a current customer to provide a quotation for a product that is similar to but different in size to products the company currently makes. You have been asked to determine the price for a product that is 20 in by 30 in. You have discussed this with your IE, and the IE has agreed to prepare this quote. The IE has collected data from similar orders that have been produced in the past. Size Sq In Std Time LCR 12 x 12 144 1.97 min 97% 12 x 20 240 3.27 86 16 x 16 256 2.43 93% 16 x 20 320 3.74 88 20 x 20 400 5.46 91 20 x 25 500 6.14 94 The IE believes that regression and LCR techniques will be useful in preparing the quote. The learning curve rate (LCR) applies only to the first 500 units. The company feels no learning takes place after 500 units. The sizes refer to rectangular steel pieces that have various operations to produce the finished product. The number of operations is a function of the size of the product. The steel pieces are 0.0625 inches thick. Steel is purchased in rolls that are 35 inches wide. Steel costs $0.475 per pound. Accounting tells you that the direct labor rate is $18.73 per hour, and the direct labor overhead rate is 49%. The labor variance is 21%. The indirect variable manufacturing expense is 329% of direct labor. Fixed costs are 29% of manufacturing costs.

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ANSWER To determine the price for the product that is 20 inches by 30 inches we can use regression and learning curve rate LCR techniques Given inform... View the full answer