Question: Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the
Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the following production cost data:
| Annualized Fixed Cost of Plant & Equipment | Variable Costs (per unit) ($) | |||
| Process Type | Labor | Material | Energy | |
| Mass Customization | $1,260,000 | 30 | 18 | 12 |
| Intermittent | $1,000,000 | 24 | 26 | 20 |
| Repetitive | $1,625,000 | 28 | 15 | 12 |
| Continuous | $2,000,000 | 25 | 15 | 10 |
Metters Cabinets projects an annual demand of
60,000 units for the Maxistand. The selling price for the Maxistand is $120 per unit.
1. Based on the projected annual demand, the best alternative available is to use the ___ process.
a. Continuous
b. Mass Customization
c. Intermittent
d. Repetitive
2. The value of annual profit using this method is $_____ enter your response here. (Enter your response as an integer.)
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