Variable Cost and Production Process Essay Example
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MG 375 Test #1
Section 1 12 points each
1. Discuss briefly (about two sentences each) the following is reasons for outsourcing?
A. Improve operating performance
Outsourcing help improve operating performance by ensuring that company focuses on doing what they know best and doing it to perfection. They also use parts from suppliers who also do what they do best instead of everyone doing half heart jobs.
B. Give employees a stronger career path
By allowing the company to just focus on what they know best it allows employees to become the experts at their job. It also allows for them know they specialty well enough to develop future improvements.
D. Turn fixed costs into variable costs
When you outsource you only pay for the products that you use. Instead of have fixed cost of stuff that aren’t being used to produce anything but still require you to produce them in order to be ready for your production process. Example when Ford own a steel mil it had the fix cost of the steel mil now that they don’t produce steel the they have the variable cost of buy steel when they need it. Need a little more about what are fixed vs. variable costs
E. Commercially exploit existing skills
By using outsourcing from subject matter experts a company can produce better products and improve their image. This will in turn increase their product demand because they have they quality from top manufactures in their products.
2. A simple project listing of five activities, their predecessors and their respective time estimates are presented below:
A simple project listing of five activities and their respective time estimates are presented below: Using CPM, which activities make up the critical path?
Prepare a CPM diagram and determine:
(a) What is the Latest Finish Time for the last activity in this project (i.e., the total time to complete the project)? 1 3 1 B 3 6 6 8
A< 1 2 > D - E
MG 375 Test #1
Section 1 12 points each
1. Discuss briefly (about two sentences each) the following is reasons for outsourcing?
A. Improve operating performance
Outsourcing help improve operating performance by ensuring that company focuses on doing what they know best and doing it to perfection. They also use parts from suppliers who also do what they do best instead of everyone doing half heart jobs.
B. Give employees a stronger career path
By allowing the company to just focus on what they know best it allows employees to become the experts at their job. It also allows for them know they specialty well enough to develop future improvements.
D. Turn fixed costs into variable costs
When you outsource you only pay for the products that you use. Instead of have fixed cost of stuff that aren’t being used to produce anything but still require you to produce them in order to be ready for your production process. Example when Ford own a steel mil it had the fix cost of the steel mil now that they don’t produce steel the they have the variable cost of buy steel when they need it. Need a little more about what are fixed vs. variable costs
E. Commercially exploit existing skills
By using outsourcing from subject matter experts a company can produce better products and improve their image. This will in turn increase their product demand because they have they quality from top manufactures in their products.
2. A simple project listing of five activities, their predecessors and their respective time estimates are presented below:
A simple project listing of five activities and their respective time estimates are presented below: Using CPM, which activities make up the critical path?
Prepare a CPM diagram and determine:
(a) What is the Latest Finish Time for the last activity in this project (i.e., the total time to complete the project)? 1 3 1 B 3 6 6 8
A< 1 2 > D - E