Crane Associates is an architectural firm that has been in practice only a few years. Because it is a relatively new firm, the market for the firm's services is very competitive. To compete successfully, Crane must deliver quality services at a low cost. Crane presents the following data for 2019 and 2020.

Architect labor-hour costs are variable costs. Architect support costs for each year depend on the Architect support capacity that Crane chooses to maintain each year (that is, the number of jobs it can do each year). Architect support costs do not vary with the actual number of jobs done that year.

2019 2020 45 53 $ 34,000 $ 33,000 20,000 23,000 1. Number of jobs billed 2. Selling price per job 3. Architect labor-hours 4. Cost per architect labor-hour 5. Architect support capacity (number of jobs the firm can do) 6. Total cost of software-implementation support 7. Software-implementation support-capacity cost per job $ 32 $ 33 68 68 $ 183,600 $ 176,800 $ 2,700 $ 2,600 Requirements 1. Calculate the amount and cost of unused architectural support capacity at the beginning of 2020, based on the number of jobs actually done in 2020. 2. Suppose Crane can add or reduce its architectural support capacity in increments of 15 units. What is the maximum amount of costs that Crane could save in 2020 by downsizing architectural support capacity? 3. Crane, in fact, does not eliminate any of its unused architectural support capacity. Why might Crane not downsize? Requirement 1. Calculate the amount and cost of unused architectural support capacity at the beginning of 2020, based on the number of jobs actually done in 2020. First select the formula, then enter the appropriate amounts to calculate cost of unused architectural support capacity at the beginning of 2020. Cost of unused capacity X = Requirement 2. Suppose White can add or reduce its architectural support capacity in increments of 10 units. What is the maximum amount of costs that White could save in 2020 by downsizing architectural support capacity? = Maximum costs saved by downsizing Requirement 3. White, in fact, does not eliminate any of its unused architectural support capacity. Why might White not downsize? Select three statements that would explain why White might not downsize. White may decide not to downsize because downsizing requires a significant reduction in capacity. For example, White may have chosen to downsize some more capacity if it could do so in increments of say, 5, rather than 10 units. White may choose not to downsize because it wants to appear as though it has the capacity to produce many more units for potential customers. White may choose not to downsize because competitors will view it as a sign of weakness if they downsize. White may choose not to downsize because it projects sales increases that would lead to a greater demand for and utilization of capacity. Not reducing significant capacity by laying off employees boosts employee morale and keeps employees more motivated and productive. 2019 2020 45 53 $ 34,000 $ 33,000 20,000 23,000 1. Number of jobs billed 2. Selling price per job 3. Architect labor-hours 4. Cost per architect labor-hour 5. Architect support capacity (number of jobs the firm can do) 6. Total cost of software-implementation support 7. Software-implementation support-capacity cost per job $ 32 $ 33 68 68 $ 183,600 $ 176,800 $ 2,700 $ 2,600 Requirements 1. Calculate the amount and cost of unused architectural support capacity at the beginning of 2020, based on the number of jobs actually done in 2020. 2. Suppose Crane can add or reduce its architectural support capacity in increments of 15 units. What is the maximum amount of costs that Crane could save in 2020 by downsizing architectural support capacity? 3. Crane, in fact, does not eliminate any of its unused architectural support capacity. Why might Crane not downsize? Requirement 1. Calculate the amount and cost of unused architectural support capacity at the beginning of 2020, based on the number of jobs actually done in 2020. First select the formula, then enter the appropriate amounts to calculate cost of unused architectural support capacity at the beginning of 2020. Cost of unused capacity X = Requirement 2. Suppose White can add or reduce its architectural support capacity in increments of 10 units. What is the maximum amount of costs that White could save in 2020 by downsizing architectural support capacity? = Maximum costs saved by downsizing Requirement 3. White, in fact, does not eliminate any of its unused architectural support capacity. Why might White not downsize? Select three statements that would explain why White might not downsize. White may decide not to downsize because downsizing requires a significant reduction in capacity. For example, White may have chosen to downsize some more capacity if it could do so in increments of say, 5, rather than 10 units. White may choose not to downsize because it wants to appear as though it has the capacity to produce many more units for potential customers. White may choose not to downsize because competitors will view it as a sign of weakness if they downsize. White may choose not to downsize because it projects sales increases that would lead to a greater demand for and utilization of capacity. Not reducing significant capacity by laying off employees boosts employee morale and keeps employees more motivated and productive