operations management assignment no 4
TEAM ASSIGNMENT NO. 4
LOCATION PROBLEMS
Problem No. 1
A) Based on Labor cost only, which location would be most economical to product the items?
Data:
LOCATION LABOR COST UNITS PRODUCE
Cambodia 6 laborers @ $3/day= $18.00/day 40
China 10 laborers @ $2/day= $20.00/day 45
Billings, Montana 2 laborers @ $60/day= $120.00/day 100
COST OF GOODS PER UNIT
LOCATION Labor cost per day/productivity COST PER UNIT
Cambodia $18.00/40 $.45
China $20.00/45 $.44
Billings, Montana $120.00/100 $1.20
Based on the data provided: China is the most economical location to product the items having lower labor cost of $0.44 per unit.
B) Considering both labor and transportation cost, which is the most favorable production location?
Data:
Transportation cost and labor cost per unit
LOCATION (amount per unit)+ (transportation cost) TOTAL COST
Cambodia $.45 + $1.50/unit $1.95
China $.44 + $1.00/unit $1.44
Billings, Montana $1.20 + $.25/unit $1.45
Based on the data provided: China is the most favorable production location based on labor and transportation cost of $1.44. per unit.
Problem No. 2
Analyze bids for 200 polished disk used in solar panels.
Data:
BIDS FOR 200 SOLAR PANEL DISK
COMPANY BID BID AMOUNT IN DOLLARS
Thailand Polishing 2000 baht ($1=10 baht $200.00
India Shine 2000 rupee ($1=8 rupee) $250.00
Sacramento Glow $200.00 $200.00
a) Company to choose: Thailand Polishing and Sacramento Glow having lower bids of $200.00 each compare to $250.00 bid of India Shine.
b) If final destination is New Delhi, India and there is 30% import tax, which firm should you choose?
BIDS FOR 200 SOLAR PANEL DISK
COMPANY Location 30% import tax Total cost
(bid) + (30% import tax) Total amount
Thailand Polishing Thailand yes $200.00 + $60.00 $260.00
India Shine India no $250.00 + $0 $250.00
Sacramento Glow Sacramento yes $200.00 + $60.00 $260.00
India Shine is the best firm to choose if the final destination of the product is New
LOCATION PROBLEMS
Problem No. 1
A) Based on Labor cost only, which location would be most economical to product the items?
Data:
LOCATION LABOR COST UNITS PRODUCE
Cambodia 6 laborers @ $3/day= $18.00/day 40
China 10 laborers @ $2/day= $20.00/day 45
Billings, Montana 2 laborers @ $60/day= $120.00/day 100
COST OF GOODS PER UNIT
LOCATION Labor cost per day/productivity COST PER UNIT
Cambodia $18.00/40 $.45
China $20.00/45 $.44
Billings, Montana $120.00/100 $1.20
Based on the data provided: China is the most economical location to product the items having lower labor cost of $0.44 per unit.
B) Considering both labor and transportation cost, which is the most favorable production location?
Data:
Transportation cost and labor cost per unit
LOCATION (amount per unit)+ (transportation cost) TOTAL COST
Cambodia $.45 + $1.50/unit $1.95
China $.44 + $1.00/unit $1.44
Billings, Montana $1.20 + $.25/unit $1.45
Based on the data provided: China is the most favorable production location based on labor and transportation cost of $1.44. per unit.
Problem No. 2
Analyze bids for 200 polished disk used in solar panels.
Data:
BIDS FOR 200 SOLAR PANEL DISK
COMPANY BID BID AMOUNT IN DOLLARS
Thailand Polishing 2000 baht ($1=10 baht $200.00
India Shine 2000 rupee ($1=8 rupee) $250.00
Sacramento Glow $200.00 $200.00
a) Company to choose: Thailand Polishing and Sacramento Glow having lower bids of $200.00 each compare to $250.00 bid of India Shine.
b) If final destination is New Delhi, India and there is 30% import tax, which firm should you choose?
BIDS FOR 200 SOLAR PANEL DISK
COMPANY Location 30% import tax Total cost
(bid) + (30% import tax) Total amount
Thailand Polishing Thailand yes $200.00 + $60.00 $260.00
India Shine India no $250.00 + $0 $250.00
Sacramento Glow Sacramento yes $200.00 + $60.00 $260.00
India Shine is the best firm to choose if the final destination of the product is New