Question: The Dorben Co. is deciding whether it is worth releasing a new 'improved' model of its Widget. The following details have been collected: Standard time
The Dorben Co. is deciding whether it is worth releasing a new 'improved' model of its Widget. The following details have been collected:
Standard time (min) = 1.00
Direct material costs er widget = $0.50
Direct labor costs per widget = $1.00
Indirect labor costs per widget = $0.50
Expense labor costs per widget = $0.50
Fixed overhead costs including sales costs/year = $50,000
a) Plot the prime cost as a function of production
b) Plot total costs as a function of production
c) Given a sales price of $3.00/widget, how many widgets must Dorben sell to make a profit? Show this point on the plot.
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a Based on a 01 min standard 60 Widgets can be produced in one hour Therefore direct la... View full answer
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