Weekly Activities 2

1. If machines at Frito-Lay are designed to 2,000 bags of chips/hr., and the plant operates 12hrs./day,
what will be the design capacity

2. If machines at Frito-Lay are designed to 3,000 bags of chips/hr., and the plant operates 10hrs./day
but due to issues in the capacity there was 10% of designed capacity became lowered, what will be
the design capacity ?

3. If Frito-Lay loses 2 hours of output per day and design capacity was 3000 chips/hr and the plant
operates 10hrs. What will be the effective capacity?

4. If Frito-Lay loses 3 hours of output per day and design capacity was 3000 chips/hr and the plant
operates 10hrs, but due to some issues the design capacity also was lowered 5%. What will be the
effective capacity?

5. There are 2 shifts. On average, if machines at Frito-Lay are not running 2 hr./shift due to late parts
and machine breakdowns and the plant operates 10hrs , what will be the actual output when design
capacity was 5000 chips/hr.

6. Sara James Bakery has a plant for processing Deluxe breakfast rolls and wants to better understand
its capability. Last week the facility produced 158,000 rolls. The effective capacity is 175,000 rolls.
The production line operates 6 days per week, with three 6-hour shifts per day. The line was
designed to process the nut-filled, cinnamon-flavored Deluxe roll at a rate of 1,300 per hour.
Determine the design capacity, utilization, and efficiency for this plant when producing this Deluxe
roll.

7. Sara James Bakery has a plant for processing Deluxe breakfast rolls and wants to better understand
its capability. Last week the facility produced 150,000 rolls. The production line operates 6 days per
week, with two 6-hour shifts per day. The line was designed to process the nut-filled, cinnamon-
flavored Deluxe roll at a rate of 1,500 per hour. Due to Determine the design capacity, effective
capacity, utilization, efficiency, expected output for this plant when producing this Deluxe roll.

Scenario 1: Alex's Handmade Candles

Alex has always been passionate about creating unique and scented candles. He decides to turn this hobby into a
business and set up a small shop. To determine the viability of his venture, he wishes to calculate his break-even
point.

Data:

1. Fixed Costs: Rent for the shop, initial marketing campaigns, and administrative costs sum up to $8,000 per
year.
2. Direct Labour: Alex decides to employ a helper for which he sets aside a labour cost of $1.00 per candle.
3. Material Costs: The wax, fragrance, wicks, and other materials cost Alex $0.60 per candle.
4. Selling Price: After doing a market survey, Alex decides to sell each candle for $3.50.

Tasks: Calculate BEP$ and BEPx

Scenario 2: Maria's Organic Skincare

Maria, a dermatologist, wishes to launch her line of organic skincare products, starting with a moisturising cream.
Before mass-producing, she wants to gauge the financial metrics and find her break-even point.

Data:

1. Fixed Costs: Licensing, lab testing, and initial promotional costs are estimated to be $15,000 annually.

2. Direct Labour: Packaging and quality testing cost Maria $2.00 per cream container.

3. Material Costs: Organic ingredients, preservatives, and the container cost total up to $3.00 per unit.

4. Selling Price: Based on perceived value and competitor pricing, Maria decides on a selling price of $10.00 per
container.

Tasks: Calculate BEP$ and BEPx