W$24$ BUAD$306$ Murphy First Name$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$ Last Name$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$

Due: Tues, $1/23$ at $11$:$59$pm EST Assignment $4$ Capacity Planning $(25$ pts$)$

Instructions: Print this page, reproduce by hand or complete via computer. Regardless, you must note answers in the space

provided ONLY. All supporting math $($round to $2$ decimal points$)$ must be shown in the corresponding space. When

completed: Take a photo of this page and next$/$save file and upload via the corresponding Assignment link in Canvas by the

due date. Remember: No $.$HEIC files OR red ink permitted.

PART $1$: Listed at the right are the Fixed and

Variable costs and maximum capacity for each

food wrapping machine being considered. $(12$

pts$)$

$1.$ What is the breakeven point for each machine if average revenue per unit is $$7\mathrm{.}00?(3$ points each$)$

BEP$740$B $=$ Answer: $\_\_\_\_\_\_\_\_\_\_\_\_$ units

BEP$1000-$C $=$ Answer: $\_\_\_\_\_\_\_\_\_\_\_\_$ units

BEP$1200-$D $=$ Answer: $\_\_\_\_\_\_\_\_\_\_\_\_$ units

$2.$ Given the BEPs you just calculated and the data in the above chart, which $($if any$)$ machine would you select if

demand was expected to range between $10,000$ and $12,000$ for several years? Justify in $1$ sentence or less. $(3$ pts$)$

Machine: $\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$ Justification: $\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$

PART $2$: Wes and Steve also want to evaluate an internal process $($P$)$ that would be used to clean and sanitize kitchen

and lunch truck equipment. The fixed and variable costs and capacities for each process are listed below. Utilize this

information to answer questions that follow. $(13$ pts$)$

Process Fixed Cost Variable

Cost$/$Unit

Capacity

P$16,000162,000$

P$210,00082,000$

P$320,00045,000$

$1.$ What are the low$-$cost output ranges for each

alternative given the cost info and capacity info at left?

$($MUST show ALL pertinent math below and relevant

ranges and notations in the $0-\backslash$infty continuum below$).$

Ranges $(3$ pts$)/$ Supporting Math $($below the line$)(6$ pts$)$

Final Answer Ranges $(3$ pts$)$:

Process Range Answer

$0-$

$2.$ If demand for sanitizing was expected to range between $1,800$ and $3,500$ units for the next $5$ years, which

process would you select? Explain in one sentence. $(1$ pt$)$

Answer: $\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$ Explanation: $\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$

Machine Fixed Cost $($$$)$ Variable Cost$/$Unit Max Capacity

Model $740$B $60,000220,000$

Model $1000-$C $50,000413,000$

Model $1200-$D $20,000611,000$

$0----------------------------------------------------------------------------\backslash$infty