Cutting Boards for Realtor A local realtor has approached Adam with a business proposition. Suzie heard...

 

 

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Cutting Boards for Realtor A local realtor has approached Adam with a business proposition. Suzie heard about Adam through word of mouth when she admired a cutting board he made for a mutual friend. She would like him to make one-off/distinct cutting boards for her clients as a house-warming gift when they use her services to purchase a home. She estimates IMA EDUCATIONAL CASE JOURNAL VOL. 15, NO. 1, ART. 1, MARCH 2022 ©2022 IMA that she would need 50 cutting boards per year and will pay between $35 and $45 depending on the size of the board (small or medium). Before committing to a long-term contract, Suzie and Adam have agreed that she will purchase an initial batch of 10 boards that will be ready in a month. Adam does his woodworking projects after work or on the weekends and does not have anyone to help him. He has all the materials on hand to make the batch of 10 boards, such as cut-off/scrap wood from other projects and glue, oil, and wax. He estimates that it will take three hours to make each board; the most labor-intensive element is sanding at roughly two hours. He is thinking of a number of alternatives for sanding: 1. Buy a drum sander, which would cost $1,250, and would cut his sanding time to one eighth. 2. Ask a semi-retired neighbor to do the sanding, using Adam's woodshop, supplies, and sanders, and pay $10 per hour the same amount the neighbor earns in a current part-time job. 3. Take the boards to a local Amish woodshop that is a 45-minute drive (35 miles away). He would pay to use their drum sander-$50 per hour (in increments of one hour or part thereof)-that an employee would operate. This price includes all supplies. The other hour to make the boards requires work on the table saw, planer, and jointer (both before and after gluing), clamping, and finishing the boards with food-grade oils and wax. Which of the 3 options is the best option? Provide calculations Cutting Boards for Realtor A local realtor has approached Adam with a business proposition. Suzie heard about Adam through word of mouth when she admired a cutting board he made for a mutual friend. She would like him to make one-off/distinct cutting boards for her clients as a house-warming gift when they use her services to purchase a home. She estimates IMA EDUCATIONAL CASE JOURNAL VOL. 15, NO. 1, ART. 1, MARCH 2022 ©2022 IMA that she would need 50 cutting boards per year and will pay between $35 and $45 depending on the size of the board (small or medium). Before committing to a long-term contract, Suzie and Adam have agreed that she will purchase an initial batch of 10 boards that will be ready in a month. Adam does his woodworking projects after work or on the weekends and does not have anyone to help him. He has all the materials on hand to make the batch of 10 boards, such as cut-off/scrap wood from other projects and glue, oil, and wax. He estimates that it will take three hours to make each board; the most labor-intensive element is sanding at roughly two hours. He is thinking of a number of alternatives for sanding: 1. Buy a drum sander, which would cost $1,250, and would cut his sanding time to one eighth. 2. Ask a semi-retired neighbor to do the sanding, using Adam's woodshop, supplies, and sanders, and pay $10 per hour the same amount the neighbor earns in a current part-time job. 3. Take the boards to a local Amish woodshop that is a 45-minute drive (35 miles away). He would pay to use their drum sander-$50 per hour (in increments of one hour or part thereof)-that an employee would operate. This price includes all supplies. The other hour to make the boards requires work on the table saw, planer, and jointer (both before and after gluing), clamping, and finishing the boards with food-grade oils and wax. Which of the 3 options is the best option? Provide calculations

Answer rating: 100% (QA)

The best option is the second option This option would require Adam to pay his neighbor 10 p... View the full answer