ENGINEERING MANAGEMENT

A1// Group discussion: students should find more information using university and internet resources. Discuss the topics in groups and draw conclusions.
A2// a. Summarise the problem description into an easy to read table on a per unit basis
In-houseper unit
Outsourceper unit
$5.00
$10.00
$10.00 × 0.75 = $7.50
$6.50
$6.50 × 0.80 = $5.20
$5.00
$5.00 × 0.80 = $4.00
50,000/100,000 = $0.50
50,000/100,000 = $0.50
Unit cost for solderingDirect material Direct labour Direct manufacturing o/h Fixed overhead (selling admin) Total Cost per Unit
$22.00
$22.20
In-house option is better since it costs less by $0.20 per unit.
b.The advantage of keeping the work in-house, is that you keep your own staff occupied/busy.
c.Maximum price Can Print Circuit would be willing to pay is $5.00 – $0.20 = $4.80
A3// Group discussion: students should find more information using university and internet resources

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