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Please answer part B, not A A. A one-product plant will operate 250 days per year using a single 8hour shift each day. Sales (one

Please answer part B, not A

A. A one-product plant will operate 250 days per year using a single 8hour shift each day. Sales (one of each component goes into each unit of product). The operations required to produce each component are given in the table below, as are the associated standard time and scrap rates. Proportion uptime is expected to be 90% during each 8hour shift. Determine how many machines are required of each type, assuming that a product layout will be used. Therefore, no machine will be shared between operations, thus eliminating the need for setup changes. (35pt)

Component Operation Machine Production time Scrap rate
A 1 Lathe 7.0 min/pc 3%
A 2 Milling machine 10.0 min/pc 5%
B 3 Lathe 5.0 min/pc 3%
B 4 Milling machine 13.0 min/pc 6%
B 5 Drill 4.0 min/pc 4%

B. For the previous problem, assume that the service life of all the machines is 15 years and the salvage value is 10% of the purchase cost. Calculate annual cost of these machines using the straight-line technique to calculate depreciation. The following table provides initial costs of each machine. In addition, calculate unit costs of the components A and B based on annual costs of the equipment used to manufacture each component. (15pt)

Machine Initial cost
Lathe $120,000
Milling machine $200,000
Drill $20,000

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