ACME CO. HAS A CONTRACT TO PROVIDE A RETAILER WITH TWO MODELS OF DOODADS: 30,000 OF MODEL
Question:
ACME CO. HAS A CONTRACT TO PROVIDE A RETAILER WITH TWO MODELS OF DOODADS: 30,000 OF MODEL A AND 15,000 OF MODEL B. PRODUCTION CAPABILITY IS LIMITED AS INDICATED IN THE TABLE BELOW. COST TO MAKE MODEL A IS $55 AND TO MAKE MODEL B IS $85. A COMPETITOR CAN SUPPLY EQUIVALENT MODELS FOR $67 AND $95. HOW MANY OF EACH MODEL SHOULD THE COMPANY PRODUCE AND OUTSOURCE TO MINIMIZE OVERALL COST?
Hours/Unit needed | Model A | Model B | Hours Available |
Production | 0.2 | 0.4 | 10,000 |
Assembly | 0.3 | 0.5 | 15,000 |
Packaging | 0.1 | 0.1 | 5,000 |
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Question 2
ACME CO. IS CONDUCTING A BENCHMARKING SURVEY TO ASSESS THE SATISFACTION OF THEIR CUSTOMERS RELATIVE TO THOSE SERVED BY COMPETITORS. 4,000 COMPANIES WERE DIVIDED INTO 4 GROUPS BASED ON SIZE (L = LARGE COMPANIES, S = SMALL COMPANIES) AND WHETHER THEY WERE SERVED BY ACME OR NOT (A = ACME, N = NOT ACME). COSTS PER SURVEYARE SUMMARIZED IN THE TABLE ABOVE. WHAT IS THE MINIMUM COST WAY TO DEPLOY THE SURVEY THAT MEETS THE FOLLOWING CONDITIONS:
- AT LEAST 10% AND AT MOST 50% OF THE TOTAL COMPANIES SHOULD COME FROM EACH GROUP.
- AT LEAST 50% OF THE COMPANIES SURVEYED SHOULD BE SERVED BY ACME.
- AT LEAST 25% OF THE SURVEYS SHOULD BE DONE BY WEB CAM.
- AT MOST 40% OF THOSE SURVEYED MAY BE SMALL COMPANIES.
- AT MOST 25% OF THE SMALL COMPANIES SURVEYED MAY BE DONE BY WEB CAM.
- AT LEAST 50% OF THE LA GROUP SHOULD BE DONE BY WEB CAM.
Thingamabobs | Whatchamacallit(in ppm) | Widget Dust (in kg) | Steam (in LBS/ton) |
1 | 1.100 | 1.7 | 24,000 |
2 | 3,500 | 3.2 | 36,000 |
3 | 1,300 | 2.4 | 28,000 |
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Accounting Principles
ISBN: 978-0470534793
10th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso