Extending the previous exercise, Worksheet 8.2 examines the effect if the cost increases by $0.50 per meal as a result of adding new kitchen capacity and staff or decreases by $0.50 as a result of spreading the fixed costs over more meals. Show the change from the current annual cost.

WORKSHEET 8.2 Winterville Meal Center Sensitivity Analysis: Planning Ratio and Cost of Meals Facts Single Family Total Change From Current Single-Family Total Change From Current Single-Family Total Change From Current Current Capacity 200 100 200 100 200 100 Increased Capacity 100 100 100 100 100 100 Meal Utilization from Facility 70% 100% 70% 100% 70% 100% Current Planning Ratio 90% 110% 90% 110% 90% 110% Planning Increment +/- 10% 10% 10% 10% 10% 10% Current Cost Lower Cost per Meal Higher Cost per Meal Cost per Meal $7.00 $7.00 Meal Increment $0.50 $0.50 Solution Current Utilization Current Cost Annualized Annual Cost Anticipated Capacity Low Planning Ratio Meal Utilization Cost per Meal Annualized Annual Cost Anticipated Capacity Current Planning Ratio Meal Utilization Cost per Meal Annualized Annual Cost Anticipated Capacity High Planning Ratio Meal Utilization Cost per Meal Annualized Annual Cost