Question: Comprehensive Case Comprehensive Case m Plating Piltdown Plating has been in operation for 20 years and applies metal coatings, such as chromium or silver. to

Comprehensive Case Comprehensive Case m Plating
Comprehensive Case Comprehensive Case m Plating Piltdown Plating has been in operation for 20 years and applies metal coatings, such as chromium or silver. to metal items by clectro-chernical processes. Each job is unique, and the company prides itself on the skill of the workers and the quality of the nal product. The production machin- ery has been depreciated to oil value. but it is still functional. There are 20 workers: 5 operate the machines that remove the old Innings: 2 work on the degreasing tanks; 5 operate the plating machines: and 3 are in the raw material store. The remaining 5 are less skilled and do final cleaning and packing. Results for a recent month were as follows: Sales revenue SEEK\" Raw materials 5 100.000 Production wages 50,000 Production salaries 10.000 Administrative salaries 5.000 Employee benets and amenities (20% of total wage bill) 13.00) Rent 10.000 Utilities 5.000 Repairs and remals 1000 Marketing and advertising 5.000 Factory depreciation ____ .njl Total cost 5 331.000 Operating prot 5:50.010 The production manager has been told by the owners that the com- pany is not profitable enough. so he has been investigating some ways of improving the return on investment. He has identied a new computerized cleaning machine that will elimi~ onto the need for ve of his workers and save $12,500 in direct wage costs every month. This machine can be rented for 35,000 per month. it will also require additional power. so utility costs will go up by 10%. Required Discuss the effect of renting the new machine on the following; - Protability - The break-even point and the risk of the company - Human resource management

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