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Tutorial 2 - Question

The document provides an introduction to operation management, focusing on key concepts such as location, break-even point, and cost analysis. It includes short essay questions and practical exercises related to break-even analysis for different business scenarios. Additionally, it discusses factors influencing location decisions and the importance of business operations.

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synergycollegeacc
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4 views3 pages

Tutorial 2 - Question

The document provides an introduction to operation management, focusing on key concepts such as location, break-even point, and cost analysis. It includes short essay questions and practical exercises related to break-even analysis for different business scenarios. Additionally, it discusses factors influencing location decisions and the importance of business operations.

Uploaded by

synergycollegeacc
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

INTRODUCTION TO OPERATION MANAGMENT

SECTION A: SHORT ESSAY

1. Define location

2. Define break-even point

3. Explain the type of cost required in the break-even point analysis.

4. What are the factors to be considered for a service location? Explain.

5. Explain four factors affecting location decisions.

6. Discuss the importance of a business by giving four reasons.


INTRODUCTION TO OPERATION MANAGMENT

SECTION B

1. A new product has the following sales and cost data

Selling price RM 60 per unit

Variable costs RM 40 per unit

Fixed costs RM 25,000 per month

forecast sales of 1,800 units per month.

Required :

i. prepare a break-even chart using the above data.

2. Razna [Link] is considering three sites for its new plants. The cost structure for

the sites is as follows.

Location Fixed cost Material cost Labour cost Overhead

cost

Sungai Petani 10,000 1.80 2.70 2.50

Kulim 15,000 1.30 2.00 1.70

Alor setar 13,000 1.50 2.30 2.20

Razna Sdn. Bhd plans to sell the product at RM 50 per unit.

Razna Sdn. Bhd plans to sell the product at RM 50 per unit.

a) find the break-even point for each site.

b) based on the break-even point analysis, decided the best site

c) determine the profit for each site if the company produces 1,200 units.
INTRODUCTION TO OPERATION MANAGMENT

3. Pl produces and sells two products. The M sells for RM 7 per unit and has a total

variable cost of RM 2.94 per unit, while the N sells for RM 15 per unit and has a

total variable cost of RM.4.5 per unit. The marketing department has estimated that

for every five units of M sold, one unit of N will be sold. The organization’s fixed

costs total RM.36,000. Required: Calculate the break-even point for PL.

a) calculate contribution per unit.

b) Total Contribution for M and N.

c) calculate the breakeven point in terms of number of mixes.

d) calculate the breakeven point in terms of the number of units of products.

e) calculate the break-even point in terms of revenue.

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