Question: Question Help Maile Machine Shop, Inc., has a 1-year contract for the production of 250,000 gear housings for a new off-road vehicle. Owner Larry Meile

Question Help Maile Machine Shop, Inc., has a
Question Help Maile Machine Shop, Inc., has a 1-year contract for the production of 250,000 gear housings for a new off-road vehicle. Owner Larry Meile hopes the contract will be extended and the volume increased next year. Meile has developed costs for three alternatives. They are general-purpose equipment (GPE). flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine Pom). The cost data follow. General Purpose Flexible Manufacturing Dedicated Equipment (GPE) System (FMS) Machine (DM) Annual contracted units 250,000 250.000 250,000 Annual fixed cost $125,000 $200,000 $480,000 Per unit variable cost $18.00 $14.00 $13.50 The option GPE is best when the contracted volume is below units (enter your response as a whole number). Enter your answer in the answer box and then click Check

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!