To facilitate a move toward JIT? production,

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Company is considering a change in its plant layout. The plant? controller,

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Brandeis commaBrandeis,

has been asked to evaluate the costs and benefits of the change in plant layout. After meeting with production and marketing? managers,

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has compiled the following? estimates:

bullet	Machine moving and reinstallation will cost $ 140 comma 000$140,000.
bullet	Total sales will increase by 15 %15% to $ 805 comma 000$805,000 because of a decrease in production cycle time required under the new plant layout. Average contribution margin is 30 %30% of sales.
bullet	?Inventory-related costs will decrease by 20 %20%. ?Currently, the annual average carrying value of inventory is $ 170 comma 000$170,000. The annual inventory financing cost is 10 %10%.