Maple Leaf processes and manufactures high-quality maple syrup for distribution to secondary processors in the province of Ontario. Maple Leaf has a superior reputation as a premium producer of maple syrup in Ontario. As a result of years of wear and tear on the production line, a critical machine in the production process has begun to produce quality issues with the syrup product. Maple Leaf is considering replacing the old machine with a new machine, either the American made Super or the Quebec made Duper. The American manufacturer and the Quebec manufacturer have provided Maple Leaf with the following data on the estimated costs of operation of each machine brand at various levels of hours of operation:

Month	Hours	Super	Duper
January	4,400	$ 125,000	$ 160,000
February	2,900	97,000	120,000
March	32,840	280,000	300,000
April	8,150	180,000	200,000
May	16,352	225,000	260,000
June	61,700	438,000	368,000

The Canadian government provides tax credits to companies who buy manufacturing equipment within its borders, but the application process is complex and there are multiple criteria that must be met to take advantage of the tax credits.

The production supervisor has come to you, as the CFO, who is responsible for providing a report on which machine to purchase, to tell you that the quality issues are not that serious and would probably not be noticed by the customers. In addition, the downtime in the production line may affect the ability to delivery the customer orders on time. The production supervisor’s bonus is partly based on the critical success factor of delivery times met. Your CEO is not yet aware of the quality issues that have been reported by quality control.

Answer rating: 100% (QA)

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