Refer to the data in the preceding exercise. Required: (1) The monthly capacity of the Gloss Coat
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Required:
(1) The monthly capacity of the Gloss Coat operation can be increased by 1,000 units if additional equipment is acquired at a cost of $2,000 per month. Should the company acquire the additional equipment?
(2) If the company acquires the equipment referred to in requirement (1), how much will the company's maximum monthly throughput increase?
(3) For the remaining parts of this exercise, assume additional equipment is not available for Gloss Coat. The monthly capacity of Surface Prep can be increased by 500 units if an additional crew is hired. The total cost of employing the additional crew will be $6,000 per month. Should the company hire the additional crew?
(4) If the company hires the additional crew referred to in requirement (3), how much will the company's maximum monthly throughput increase?
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1 No they should not acquire the equipment Gloss Coat is not the ...View the full answer
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