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Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the
Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the following production cost data:
What is the minimum number of Maxistand Metters Cabinets, Inc. needs to sell in order to make a net profit (Rev Fixed Cost Total Variable Cost) of $1,165,000? Assume that each Maxistand will sell for $129.
\begin{tabular}{|c|c|c|c|c|} \hline PROCESS TYPE & ANNUALIZEDFIXEDCOSTOFPLANT&EQUIP. & \multicolumn{3}{|c|}{ VARIABLE COSTS (PER UNIT) (\$) } \\ \cline { 3 - 5 } & \$ABOR & MATERIAL & ENERGY \\ \hline Job Shop & $1,000,000 & 24 & 26 & 20 \\ \hline MassCustomization & $1,190,000 & 30 & 18 & 12 \\ \hline Repetitive & $1,385,000 & 28 & 15 & 11 \\ \hline Continuous & $1,660,000 & & & \\ \hline \end{tabular}Step by Step Solution
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