Due to the war in Ukraine, wheat manufacturing plants in t South Africa and considering various...
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Due to the war in Ukraine, wheat manufacturing plants in t South Africa and considering various options to streamline their manufacturing processes. Currently, the business expects to make a revenue of ZAR 160 000. TIMVO, a business development firm, has been contracted to observe the manufacturing process and has listed the following possible suggestions. a. Continue to operate at the current capacity. b. Upgrade the entire operating machinery for ZAR 20 000. If implemented successfully, an increase in revenue of ZAR 220 000 is expected. If unsuccessful an increase in revenue of ZAR 80 000 is expected. The probability of success is 0.5. c. Upgrade the machinery partially focusing only on essential machinery, costing ZAR 4000. If implemented successfully the expected revenue would be expected to be ZAR 80 000 and if unsuccessful revenue would be ZAR 30 000. The probability of successful implementation is 0.3. Given this information determine the best course of action for the business to undertake and comment on your findings [10] Due to the war in Ukraine, wheat manufacturing plants in t South Africa and considering various options to streamline their manufacturing processes. Currently, the business expects to make a revenue of ZAR 160 000. TIMVO, a business development firm, has been contracted to observe the manufacturing process and has listed the following possible suggestions. a. Continue to operate at the current capacity. b. Upgrade the entire operating machinery for ZAR 20 000. If implemented successfully, an increase in revenue of ZAR 220 000 is expected. If unsuccessful an increase in revenue of ZAR 80 000 is expected. The probability of success is 0.5. c. Upgrade the machinery partially focusing only on essential machinery, costing ZAR 4000. If implemented successfully the expected revenue would be expected to be ZAR 80 000 and if unsuccessful revenue would be ZAR 30 000. The probability of successful implementation is 0.3. Given this information determine the best course of action for the business to undertake and comment on your findings [10]
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Related Book For
Taxation Of Individuals And Business Entities 2015
ISBN: 9780077862367
6th Edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver
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