oft Word - Case Study T 2 -A A A 11 Calibri (www. xx, she-U I B b Case Study For a long year, Car Painting Company has provided their services for automobiles in its region. Manufacturers of various metal products have relied on the quality and quick turraround time provided by Car painting company and its 20 skilled employees. During the last year, as a result of a sharp upturn in the economy, the company's services have increased by 30% relative to the previous year. The company has not been able to increase its capacity fast enougit so it has had to turn work away because it cannot keep up with customer requests. Top management is discussing two alternatives to cover customer needs which will increase sales S400.000 First continuing with manual based depending on labor work, regarding to this alternative the company should increase their labor to 30 skilled labor which could increase variable cost by 25% and fixed cost is remained constant. Second moving to automate based depending on sophisticated robotic pointing booth. The booth would representa considerable move in the direction of automation versus manual labor. As a result of purchasing the booth, it would most likely lay off 10 of its skilled painters and variable cost will be declined by S200,000, on the other hand fixed cost will be increased to $800,000 Current Situation before taking the decision is Service Revenues $1,600,000 Variable Cost $1.200.000 Contribution Margin $400,000 S380,000 Fixed Cos! Operating income $20,000 Instructions 1- you are a financial advisor to management, and not on above data which alternative would you recommend them to keep up customer requirease the revenues to $2.000.000 depending of ont skill waters approach ar moving to automated pintaachlysur decision will based on financial indicators that you learned in chute 1-CVP- 2- Which alternative achieve target Opo SIG0.000 3- At what pantat revenues the peuting name will be equatir bith iterative Avicenus estimated to be decreed in next year by 10% which are more 157329124 W lis oft Word - Case Study T 2 -A A A 11 Calibri (www. xx, she-U I B b Case Study For a long year, Car Painting Company has provided their services for automobiles in its region. Manufacturers of various metal products have relied on the quality and quick turraround time provided by Car painting company and its 20 skilled employees. During the last year, as a result of a sharp upturn in the economy, the company's services have increased by 30% relative to the previous year. The company has not been able to increase its capacity fast enougit so it has had to turn work away because it cannot keep up with customer requests. Top management is discussing two alternatives to cover customer needs which will increase sales S400.000 First continuing with manual based depending on labor work, regarding to this alternative the company should increase their labor to 30 skilled labor which could increase variable cost by 25% and fixed cost is remained constant. Second moving to automate based depending on sophisticated robotic pointing booth. The booth would representa considerable move in the direction of automation versus manual labor. As a result of purchasing the booth, it would most likely lay off 10 of its skilled painters and variable cost will be declined by S200,000, on the other hand fixed cost will be increased to $800,000 Current Situation before taking the decision is Service Revenues $1,600,000 Variable Cost $1.200.000 Contribution Margin $400,000 S380,000 Fixed Cos! Operating income $20,000 Instructions 1- you are a financial advisor to management, and not on above data which alternative would you recommend them to keep up customer requirease the revenues to $2.000.000 depending of ont skill waters approach ar moving to automated pintaachlysur decision will based on financial indicators that you learned in chute 1-CVP- 2- Which alternative achieve target Opo SIG0.000 3- At what pantat revenues the peuting name will be equatir bith iterative Avicenus estimated to be decreed in next year by 10% which are more 157329124 W lis