Answer Happy

An engineer working at a factory which manufacture electrical components has a selection of using Machine A and B to manufacture the components. Orders received from customers are in frequent and orderly fashion with variation of quantities, Machine A consist of four (4) production operations. Each of the operation requires set up before it could be operational. 1 hour is needed to perform the set up for each operation. After the machine has been set up, each of the component requires 0.5 hour to be produced. Besides, machine B comprises of eight (8) production operations. Each of the operation requires 0.75 hours to be set up before it could be operational. After the machine has been set up, each of the component requires 0.55 hours to be produced. The operator wages are RM 5 /hour for machine A and RM 4,50 /hour for machine B. The overhead cost of machine A is RM 10/hour while for machine B, the overhead cost is RM 9/hour. The overhead cost including the cost of setting up the machine. Determine the suitable machine to be used if the orders received are (a) 100 unit (b) 500 unit Determine the quantity of orders for both machines to be breakeven (Notes: TC machine A = TC machine B).