Bill Pope Has Developed a New Device That Is So

question 30

Essay

Bill Pope has developed a new device that is so exciting he is considering quitting his job in order to produce and market it on a large-scale basis.Bill will rent a garage for $300 per month for production purposes.Utilities will cost $40 per month.Bill has already taken an industrial design course at the local community college to help prepare for this venture.The course cost $300.Bill will rent production equipment at a monthly cost of $800.He estimates the material cost per unit will be $5,and the labor cost will be $3.He will hire workers and spend his time promoting the product.To do this he will quit his job which pays $3,000 per month.Advertising and promotion will cost $900 per month.
Required:
Complete the chart below by placing an "X" under each heading that helps to identify the cost involved.There can be "Xs" placed under more than one heading for a single cost,e.g. ,a cost might be a sunk cost,an overhead cost and a product cost;there would be an "X" placed under each of these headings opposite the cost. * Between the alternatives of going into business to make the device or not going into business to make the device.

---

Definitions:

Capable

Possessing the ability, fitness, or quality necessary to do or achieve a specified thing.

Center Line

In statistical process control charts, the center line represents the mean value of the quality characteristic being measured.

Control Limits

Refer to the statistical bounds within process control that signal when a process might be going out of control or is otherwise operating outside of its expected range.

Special Cause Variation

Variation in a process caused by identifiable factors, typically indicating that the process is not in control.