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Business, 17.09.2019 19:00 xojade

1. a production machine operates in a semi-automatic cycle but a worker must tend the machine 100% of the time to load parts. unloading is accomplished automatically. the worker’s cost rate = $27/hr including applicable labor overhead rate. the equipment cost rate of the machine = $18.00/hr including applicable overhead costs. cost of the starting parts = $0.15/pc. the job runs several months so the effect of setup can be ignored. each cycle, the actual process time = 24 sec, and time to load the part = 6 sec. automatic unloading takes 3 sec. a proposal has been made to install an automatic parts-loading device on the machine. the device would cost $36,000 and would reduce the part loading time to 3 sec each cycle. its expected life = 4 years. the device would also relieve the worker from full-time attention to the machine. instead, the worker could tend four machines, effectively reducing the labor cost to 25% of its current rate for each machine. the operation runs 250 days per year, eight hours per day. assume availability = 100% and scrap rate = 0. determine the cost per part produced (a) without the parts loading device and (b) with the parts loading device installed. (c) how many days of production are required to pay for the automatic loading device? in other words, find the breakeven point.

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