Borges Machine Shop, Inc., has a 1-year contract for the production of 225,000 gear housings for a new off-roadvehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges hasdeveloped costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturingsystem (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow:Annual contracted unitsAnnual fixed costPer unit variable costGeneral-PurposeEquipment (GPE)225,000$125,000$18.00The option GPE is best when the contracted volume is belowFlexible ManufacturingSystem (FMS)DedicatedMachine (DM)225,000$500,000$13.00225,000$200,000$14.00☐units (enter your response as a whole number). The option GPE is best when the contracted volume is below 75,000 units (enter your response as a whole number).The option FMS is best when the contracted volume is between 75001 and 325,000 units (enter your responses aswhole numbers).The option DM is best when the contracted volume is over 325,000 units (enter your response as a whole number).

GPEFMSDMAnnual contracted units225,000225,000225,000Annual fixed cost$125,000$200,000$500,000Per…

Answered: Borges Machine Shop, Inc., has a 1-year…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Borges Machine Shop, Inc., has a 1-year contract for the production of 250,000gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow: General-Purpose Equipment (GPE) Flexible Manufacturing System (FMS) Dedicated Machine (DM) Annual contracted units 250,000 250,000 250,000 Annual fixed cost $125,000 $200,000 $525,000 Per unit variable cost $16.00 $14.00 $13.00 The option GPE is best when the contracted volume is below…
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Borges Machine Shop, Inc., has a 1-year contract for the production of 225,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow: General-Purpose Equipment (GPE) Flexible Manufacturing System (FMS) Dedicated Machine (DM) Annual contracted units 225,000 225,000 225,000 Annual fixed cost $100,000 $225,000 $480,000 Per unit variable cost $16.00 $14.00 $13.00 Part 2 The option GPE is best when the contracted volume is below…
Borges Machine Shop, Inc., has a 1-year contract for the production of 225,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow: General-Purpose Equipment (GPE) Flexible Manufacturing System (FMS) Dedicated Machine (DM)Annual contracted units 225,000 225,000 225,000 Annual fixed cost $125,000 $250,000 $480,000 Per unit variable cost $18.00 $14.00 $13.00 a.The option GPE is best when the contracted volume is below ------ units (enter your response as a whole number).…

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