Question

i need help with d-1 d-2 and e please!

Problem 7-15 Chec The Goodparts Company produces a component that is subsequently used in the aerospace industry. The component consists of three parts (A, B, and C) that are purchased from outside and cost 35, 30, and 10 cents per piece, respectively. Parts A and B are assembled first on assembly line 1, which produces 110 components per hour. Part C undergoes a drilling operation before being finally assembled with the output from assembly line 1. There are in total six drilling machines, but at present only three of them are operational. Each drilling machine drills part C at a rate of 40 parts per hour. In the final assembly, the output from assembly lines assembled with the drilled part C. The final assembly line produces at a rate of 130 components per hour. At present, components are produced eight hours a day and five days a week. Management believes that if need arises, it can add a second shift of eight hours for the assembly lines. The cost of assembly laboris 25 cents per part for each assembly line the cost of drilling labor is 15 cents per part. For drilling, the cost of electricity is 1 cent per part. The total overhead cost has been calculated as $1,600 per week. The depreciation cost for equipment has been calculated as $30 per week. a. Determine the process capacity (number of components produced per wek) of the entire process. Process capacity 4,400 units per week b-1. Suppose a second shift of eight hours is run for assembly line 1 and the same is done for the final assembly line. In addition, four of the six drilling machines are made operational. The drilling machines, however, operate for just eight hours a day. What is the new process capacity (number of components produced per week)? New process capacity 6.400 units per week

Answer 1

D 1:

Following is the cost per unit when output is 6400:

Particulars	Unit cost per week	Output	Total cost
Parts purchased	$0.35+$0.30+$0.10=$0.75	6400	$4800
Electricity	$0.01	6400	$64
Assembly labor	2 assemblies x $0.25=$0.5	6400	$3200
Drilling labor	$0.15	6400	$960
Overhead cost	$1600		$1600
Depreciation	$30		$30
Total cost per week			$10654
Units per week			6400
Cost per unit	1.6646875

The cost per unit is calculated using the following formula:

=Total cost per week/No.of units produced per week

=$10654/6400

=$1.6646875 per unit

D 2:

Following is the cost per unit when output is 7800:

Particulars	Unit cost per week	Output	Total cost
Parts purchased	$0.35+$0.30+$0.10=$0.75	7800	$5850
Electricity	$0.01	7800	$78
Assembly labor	2 assemblies x $0.25=$0.5	7800	$3900
Drilling labor	$0.15	7800	$1170
Overhead cost	$1600		$1600
Depreciation	$30		$30
Total cost per week			$12628
Units per week			7800
Cost per unit	1.61897435897

The cost per unit is calculated using the following formula:

=Total cost per week/No.of units produced per week

=$12628/7800

=$1.61897435897 per unit