Question: CAPACITY MANAGEMENT Page 116, chapter 5 Use example 5.1 as a prompt but not as direct instructions. Small local company produces two types of

CAPACITY MANAGEMENT Page 116, chapter 5 Use example 5.1 as a promptbut not as direct instructions. Small local company produces two types of

CAPACITY MANAGEMENT Page 116, chapter 5 Use example 5.1 as a prompt but not as direct instructions. Small local company produces two types of popular drinks with original citrus and apple flavors. The expected demand for two flavors for the next 5 years (in number of cans) is given in the table. The company can buy two or three machines to package them. Each machine cost $85,000 and can package 90,000 drinks a year. Each machine can be used to package the both flavors, and time and expenses to switch from one flavor to another are so small they can be neglected. The expected profits per can is given and they are different for different flavors. Find out how many machines it makes sense to buy to maximize profit by filling with formulas (submissioins without formulas will not be graded) the highlighted cells in this worksheet. Rename the worksheet by your last name. Years Citrus 1 2 5 80,000 100,000 Apple Total 60,000 80,000 120,000 100,000 130,000 140,000 Profit (per can) $ 0.80 100,000 100,000 $ 1.00 one machine cost one machine productivity (in cans per year) 2 machines profit 3 machines profit $ 85,000 90,000 total net profit-2 machines net profit-3 machines Calculate total net profits over 5 years if you buy 2 machines and if you buy 3 machines filling by formulas highlighted cells. How many machines it makes sense to buy to maximize profit (number)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!