Borges Machine Shop. Inc, has a 1 year contract for the production of 250,000 gear...
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Borges Machine Shop. Inc, has a 1 year contract for the production of 250,000 gear housings for a new off road vehicle Owner Luis Borges hopes the contract will be extended and the volume increased next year Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM) The cost data follow General Purpose Flexible Manufacturing Dedicated 000250 000 $225.000 $1400 Machine (DM) 250,000 $480.000 $13 00 Annual contracted units Annual foxed cost Per unit variable cost 250,000 $125,000 The option GPE is best when the contracted volume is below units (enter your response as a whole number) The option FMS is best when the contracted volume is between and units (enter your responses as whole numbere) The option DM is best when the contracted volume is overunits (enter your response as a whole number)
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