Q Search this AGE MINDTAP 7 Homework: Process Selection, Design, and Improvement LE Spreadsheet Samoset Fans, Inc. manufacturers its fan blades in-house. The owner, Betty Dice, doesn't outsource any fan parts except fan motors - all other fans parts are made in house. Their current process and its equipment are getting old. Maintenance and repair costs are increasing at ten percent per year. She and her company team are evaluating two new processes. The first process has an annual fixed cost of $740,000 and a variable cost of $14 per fan blade. The second process is more automated and requires an annual foed cost of $1,250,000 and a variable cost of $11 per fan blade. The internal transfer cost of a fan blade is $20, and this helps the firm determine the total manufactured cost of a completed fan. Use the Excel template Break Even in Mind Tap to answer the following questions: a. What is the break-even quantity between these two processes? Round your answer to the nearest whole number. 138889 fan blades b. Il predicted demand for next year is 110,000 blades, what process do you recommend? Round your answers to the nearest dollar Total cost of Process A: $ 2280000 Total cost of Process B: $ 2460000 50, Process A is recommended What is the cost savings? Round your answer to the nearest dollar 5 180000 c. What volume of demand does Samoset Fans, Inc need to make an internal profit on fan blades of $100,000, assuming they installed the process you recommend in part (b)? Round your answer to the nearest whole number, 396667 fan blades Ilide Feedback B Partially Correet Hints) Check My Work A desineintregmail.com AutoSave break even (5) - Protected View File Home Insert Draw Page Layout Formulas Data Review View Help PROTECTED VW Beetles from the It can continues. Unless you need to edit ale to stay in Protected View Enable Editing F G H RS fo 10000 A B D 1 Break-Even Analysis Cengage learning. Not for commercial use. 2 Enter data only in yellow cells. 3 4 Profitability Analysis Outsourcing Decision Quantity 10,000 Technology Choice Decision Quantity 12,000 Quantity 11,000 Produce In-House Option A 7 Cost 8 9 Fixed cost Unit cost $100,000.00 $12.00 Fixed cost $250,000.00 Unit cost $20.00 Fixed cost Unit cost $200,000.00 $18.60 10 11 12 Revenue Outsource Option B Unit revenue Fixed cost Unit cost Fixed cost Unit cost $20.00 $100,000.00 $21.00 $15.00 15 16 Total Cost Total Revenue Net Profit Profit or loss $220,000.00 $200,000.00 $20,000.00 Loss Total In-House Production Cost $490,000.00 Total Outsourced Cost $420,000.00 Cost difference In-House. Outsourced) $70,000.00 Economical Decision Outsource Total Cost Option A Total Cost Option Cost difference (Option A. Option B) Economical Decision $404,600.00 $331,000.00 $73,600,00 Options 19 20 21 22 24 25 28 29 30 Break Even Type here to search o E
