A Company Has Tool Cribs Where Workmen Draw Parts

question 48

Essay

A company has tool cribs where workmen draw parts.Two men have applied for the position of distributing parts to the workmen.George Fuller is fresh out of trade school and expects a $6 per hour salary.His average service time is four minutes.John Cox is a veteran who expects $12 per hour.His average service time is two minutes.A workman's time is figured at $10 per hour.Workmen arrive to draw parts at an average rate of 12 per hour.
a.What is the average waiting time a workman would spend in the system under each applicant?
b.Which applicant should be hired?
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Definitions:

Amortization Expense

Amortization expense is the cost associated with gradually writing off the initial cost of an intangible asset over its useful life.

Capital Asset

Long-term property or investment held by a business or individual, intended for use or investment purposes rather than for sale.

Fair Value Increments

Adjustments made to the book value of assets and liabilities to reflect their current market value during acquisition accounting.

Depreciable Assets

Assets whose cost is allocated over their useful lives through depreciation, typically tangible assets like machinery, buildings, and equipment.