Mathematics, 20.06.2021 03:40, deaishaajennings123
Lens Care Inc. (LCI) manufactures specialized equipment for polishing optical lenses. There are two models - one mainly used for fine eyewear (F-32) and another for lenses used in binoculars, cameras, and similar equipment (B-13).
The manufacturing cost of each unit is calculated using activity-based costing, using the following manufacturing cost pools:
Cost Pools Allocation Base Costing Rate
Materials handling Number of parts $ 2.40 per part
Manufacturing supervision Hours of machine time $ 14.80 per hour
Assembly Number of parts $ 3.30 per part
Machine setup Each setup $ 56.50 per setup
Inspection and testing Logged hours $ 45.50 per hour
Packaging Logged hours $ 19.50 per hour
LCI currently sells the B-13 model for $1,775 and the F-32 model for $1,220. Manufacturing costs and activity usage for the two products are as follows:
B-13 F-32
Direct materials $ 164.50 $ 75.60
Number of parts 160 120
Machine hours 7.90 4.20
Inspection time 1.70 0.80
Packaging time 0.90 0.50
Setups 3 2
The market price for B-13 and F-32 are reduced to $1,695 and $1,095 respectively. To achieve the target cost, Lens Care plans to reduce materials handling costs. How many parts must be removed from B-13 in order to achieve the target cost for B-13 (round up to whole units)?
Multiple Choice
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Answers: 1
Mathematics, 21.06.2019 16:00, blackwhiteroses383
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Answers: 2
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