Question

Not se MGMT 328 TR Fall 2019 Osita Unamba jr & 10/29/19 1:14 PM Test: Exam 2_short problems Time Remaining: 01:05.32 Submit Test anager This Question: 9 pts 5 of 5 (0 complete) This Test: 51 pts possibl Tim Urban, owner/manager of Urban's Motor Court in Key West, is considering outsourcing the daily room cleanup for his motel to Duffy's Maid Service. Tim rents an average of 50 rooms for each of 365 nights (365 x 50 equals the total rooms rented for the year). Tim's cost to clean a room is $12.50. The Duffy's Maid Service quote is $18.50 per room plus a fixed cost of $24,000 for sundry items such as uniforms with the motel's name. Tim's annual fixed cost for space, equipment, and supplies is $60,000 Based on the given information related to costs for each of the options, the crossover point for Tim room nights (round your response to the nearest whole number) If the number of room nights is less than the crossover point, then is the best option available to Tim. Based on the given room nights that Trn expects to rent (18.250), the best option is ng ary ces Enter your answer in the answer box er n Tools www r Before you start. run the Browser Check to confirm OPERATIONS re to search

Answer 1

It cross over point cost for both options is same. Cost for Tim = cost for Duffy's maid service 60000 +12.52 = 20000 + 18052 mom 2 = 6000 crcom nights Crossovepoint for Tim = 16000 room nights

1 Option with less fored cost is better for lower volumes If number of room nights is less than crossover point, then Duffy's maid service is best option 18 250 76000 4. Based on given room nights, the best option is Tem cleaning DU -