The manufacturing firms that are competing with each other on the different processes shown in the below figure.

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Chapter 7, Problem 9DQ

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To determine: The manufacturing firms that are competing with each other on the different processes shown in the below figure.

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California Gardens, Inc., prewashes, shreds, and dis-tributes a variety of salad mixes in 2-pound bags. Doug Voss, Operations VP, is considering a new Hi-Speed shredder to replacethe old machine, referred to in the shop as “Clunker.” Hi-Speedwill have a fixed cost of $85,000 per month and a variable costof $1.25 per bag. Clunker has a fixed cost of only $44,000 permonth, but a variable cost of $1.75. Selling price is $2.50 per bag.a) What is the crossover point in units (point of indifference) forEric Limon/ Shutterstock the processes? b) What is the monthly profit or loss if the company changes tothe Hi-Speed shredder and sells 60,000 bags per month?c ) What is the monthly profit or loss if the company stays withClunker and sells 60,000 bags per month?

3. Figure 5.11 details the process flow for two types of custom-ers who enter Barbara’s Boutique shop for customized dressalterations. After step T1, Type A customers proceed to step T2and then to any of the three workstations at T3, followed bysteps T4 and T7. After step T1, Type B customers proceed tostep T5 and then steps T6 and T7. The numbers in parenthe-ses are the minutes it takes to process a customer.a. What is the capacity of Barbara’s shop in terms of thenumbers of Type A customers who can be served in anhour? Assume no customers are waiting at steps T1 or T7.b. If 30 percent of the customers are Type A customers and70 percent are Type B customers, what is the averagecapacity of Barbara’s shop in customers per hour? c. Assuming that the arrival rate is greater than five custom-ers per hour, when would you expect Type A customers toexperience waiting lines, assuming no Type B customersin the shop? Where would the Type B customers have towait, assuming no Type A customers?

5. Slide 5: Process Strategy• Identifies the process strategy used by the company (Walmart).• Explain the main types of processes used in company operations.