What completion date would you recommend? Show

Marketing
20th Edition
ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
Section: Chapter Questions
Problem 6DRQ
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You company has just received an order for SPEEDY 1 electric motor from a customer. The data on direct
costs, activity duration, and precedence relationships are given below:
Activity
Normal Time (days)
Normal Cost
Crash Time (days)
Crash Cost
Predecessor(s)
A
4
$1000
3
$1300
B
7
1400
2000
2000
4
2700
D
6.
1200
5.
1400
A
3
900
2
1100
B
F
11
2500
3750
G
4
800
3
1450
D, E
3
300
500
F, G
H
f) Nonetheless, the contract states that starting on the thirteenth day from now, your firm will experience
a penalty of $100 per day if the job is not completed. Indirect project costs amount to $200 per day.
What completion date would you recommend? Show your computation.
Transcribed Image Text:You company has just received an order for SPEEDY 1 electric motor from a customer. The data on direct costs, activity duration, and precedence relationships are given below: Activity Normal Time (days) Normal Cost Crash Time (days) Crash Cost Predecessor(s) A 4 $1000 3 $1300 B 7 1400 2000 2000 4 2700 D 6. 1200 5. 1400 A 3 900 2 1100 B F 11 2500 3750 G 4 800 3 1450 D, E 3 300 500 F, G H f) Nonetheless, the contract states that starting on the thirteenth day from now, your firm will experience a penalty of $100 per day if the job is not completed. Indirect project costs amount to $200 per day. What completion date would you recommend? Show your computation.
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