To remain competitive Axis Systems management believes the company must
To remain competitive, Axis Systems’ management believes the company must produce Job
B–type servers (from C4-53) at a target cost of $5,400. Axis Systems has just joined a B2B emarket site that management believes will enable the firm to cut direct material costs by 10%. Axis’s management also believes that a value-engineering team can reduce assembly time.
Requirements
Compute the assembly cost savings per Job B-type server required to meet the $5,400 target cost.
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