Please the following questions 1. On a business trip, Mr. Pines is driving to me
ID: 1221737 • Letter: P
Question
Please the following questions
1. On a business trip, Mr. Pines is driving to meet with a prospective customer. Mr. Pines notices that the gas tank is almost empty. The "GasGuru" app in his iPhone says the least expensive gas station is about 15 miles away. A gas station closer to his current location would cost $0.10 more than the least expensive gas station which is 15 miles away. The capacity of the gas tank ofthe car he is driving is 20 Gallons. What would he decide to do? Why? 2. Cruces Manufacturing Inc. is making two products A and B at its plant location in Las Cruces, NM. The cost data for the two products are in the table below $60 $50 Selling price $30 $25 Variable cost $30,000 Fixed cost/quarter a. Assuming the number of product A is equal to 3 times the number ofproduct B, determine the breakeven in b. If the company made 4,500 units of A and 1,500 units of B respectively during the last quarter, what is the profit made? c. Assume this quarter the company is planning on making only product A, what would be the breakeven volume in number ofunits of A? d. Assume this quarter the company is planning on making only product B and the fixed cost has increased from $30,000 to $40,000, what would be the breakeven volume in number of units of B?Explanation / Answer
1. Mr. Pines will fill his gas tank from the gas station closer to his current location because he is moving to meet his customer and it can be possible that GasGuru app may be wrong or his car does not able to cover 15 miles from the remaining gallons then Mr. Pines will not be able to meet the customer and due to this he looses his one of his customers. But if filled his gas tank at $ 0.10 more cost than it costs less than loosing one customer. So, Mr. Pines has to fill his tank by the nearest gas station.