Question;1.5-51 Edwards;Restaurant Supplies is investigating the possibility of adopting a lean;production philosophy throughout their;organization. Estimated costs to set up;the computer system are $650,000, training employees in lean;production is estimated to cost $175,000, and the general expenses of establishing the program are estimated at $35,000.;The estimated value of the potential savings is $975,000. Do;the benefits outweigh the costs or do the costs outweigh the benefits, and by how much?;A. Costs outweigh benefits by $150,000.;B. Benefits outweigh costs by $150,000.;C. Costs outweigh benefits by $115,000.;D.;Benefits outweigh costs by $115,000.;1.5-52 Gilmore;Corporation is investigating the possibility of adopting a lean production;philosophy in its manufacturing;facilities. The plant manager has done a;cost-benefit analysis and has found that the costs of the;lean production program exceed the benefits by $115,000. You analyze the situation;and make some adjustments to the cost estimates. After doing your analysis, you find that;costs still outweigh benefits;by less than 5%. Which might be a sound course of action?;A. Consider dropping the plan.;B. Look for ways to lessen costs.;C. Re-evaluate the value of benefits.;D. All of the above should be considered.
Paper#54960 | Written in 18-Jul-2015Price : $22