Question
Enough Company is capable of turning out 15 completed units every 30 seconds. The plant normally operates for 5 days a week on a two
Enough Company is capable of turning out 15 completed units every 30 seconds. The plant normally operates for 5 days a week on a two 8-hour shift. Each year, the factory is closed 12 working days for holidays. Machinery is idle 750 hours for cleaning, oiling, and maintenance. Normal sales averages 110,000 units a year over a 5-year period. The expected sales volume for the year is 112,500 units. The fixed cost of operating the plant is 385,000 per year. How much is the idle capacity cost under normal capacity if the plant operated at 3,400 hours?
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