Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Borges Machine Shop, Inc., has a 1-year contract for the production of 200,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes
Borges Machine Shop, Inc., has a 1-year contract for the production of 200,000 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) 200,000 $100,000 $16.00 200,000 $200,000 $14.00 200,000 $500,000 $13.00 The option GPE is best when the contracted volume is below The option FMS is best when the contracted volume is between The option DM is best when the contracted volume is over Annual contracted units Annual fixed cost Per unit variable cost units (enter your response as a whole number). and units (enter your responses as whole numbers). units (enter your response as a whole number).
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started