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A Component can be produced with equal facility on either a capstan lathe or a single-spindle automatic. Find the break-even quantity QE if the the following data is given.

Capstan Lathe Automatic

(i) Tooing Cost £4.00 £4.00

(ii) Cost of Cams _ £15.00

(iii) Material Cost/Component £0.025 £0.025

(iv) Operating Labour Cost £0.25/h £0.10/h

(v) Cycle Time/Component 4 min 1 min

(vi) Setting up Labour Cost £0.40/h £0.40/h

(Setting and Operating) 300% of 1000%

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M93075333

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