Please help answer all questions!:) Assume that the annual fixed cost for manufa

Question

Please help answer all questions!:)

Assume that the annual fixed cost for manufacturing the calculator is $340,000 and the total variable cost is $4.8 for each unit produced. The manufacturer has a bid form an outside firm to produce the calculator for S6.5 per unit. Q1. The total cost for producing 12,000 units of the calculator (TMC) is Q2. The total cost for outsourcing (purchasing) 12,000 units of the calculator (TPC), Q3. The savings due to outsourcing is Q4. The break-even point is about Q5. The average cost/unit for the production of a particular component at a manufacturing plant varies with the number of units produced in each batch. The data are given below: Number of units produced 0-49 50-100 Cost/unit $37.72 $25.02 Suppose the selling price of each unit is $30. Build a model to calculate the profit of the manufacturing industry if the demand is 25. The Profit is

Explanation / Answer

Given Fixed Cost=340,000$

Variable Cost per unit=4.8$

Outsourcing goods cost per unit =6.5$

1.Total Cost to produce 12000 units=340,000+4.8*12000=397600$

2.Total cost of outsourcing=12000*6.5=78000$

3. Savings=397600-78000=319600

4.Break even point In units is calculated as =Fixed cost/(Price-Variable cost)

=340000/( P-4.8)=12000

Hence the price should be 33.33

Question 5

Given SP=30$ per unit

For a demand of 25 we have cost/unit=37.72$

We know SP-CP= Profit

30* No of Units-37.72* No of Units=Profit

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---