Problem 03Complying with all, government housing regulations and requirements, theemployees union of a certain firm has the option to purchase either of twosites, each having an area of 18 hectares (180,000 sq.m.) of undeveloped land.The first singly owned, would cost Php20.00 a sq.m, but would needaroadway system, including the access road, 4,000 meters long, at a cost of Php110.00 per meter. Additional development expenses would be Php 60,000 tosubdivide and grade into 320 house löts, and another Php 32,000 for a hollowblock fence and security gates.The second site consists of three lots, separately owned, with a totalarea of 18 hectares: 7 hectares at Php 25.00 a sq.m. 5 hectares at Php 21.00 asq.m and 6 hectares at Php 14.00 a sq.m. The road system for this would beonly 3,200 meters long at Php 100.00 per meter, but needs two box culvertseach costing Php 25.000.00. Lot grading would be Php 35,000; fencing andsecurity 8atës Phip 24,000.Assuming that all other facilities would cost the same in both sites,which of the two sites would you recommend based on cost of sitedevelopment alone? Problem 03Complying with all government housing regulations and requirements, theemployees union of a certain firm has the option to purchase either of twosites, each having an area of 18 hectares (180,000 sq.m.) of undeveloped land.The first singly owned, would cost Php20.00 a sq.m., but would need aroadway system, including the access road, 4,000 meters long, at a cost of Php110.00 per meter. Additional development expenses would be Php 60,000 tosubdivide and grade into 320 house lots, and another Php 32,000 for a hollowblock fence and security gates.The second site consists of three lots, separately owned, with a totalarea of 18 hectares: 7 hectares at Php 25.00 a sq.m. 5 hectares at Php 21.00 asq.m; and 6 hectares at Php 14.00 a sq.m. The road system for this would beonly 3,200 meters long at Php 100.00 per meter, but needs two box culvertseach costing Php 25,000.00. Lot grading would be Php 35,000; fencing andsecurity gates PhpAssuming that all other facilities would cost the same in both sites,which of the two sites would you recommend based on cost of sitedevelopment alone?

The given area is 18 hectares, and the site recommendation for both projects can be done as follows.

Answered: Assuming that all other facilities…

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

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Problem 03 Complying with all, government housing regulations and requirements, the employees union of a certain firm has the option to purchase either of two sites, each having an area of 18 hectares (180,000 sq.m.) of undeveloped land. The first singly owned, would cost Php20.00 a sq.m, but would needa roadway system, including the access road, 4,000 meters long, at a cost of Php 110.00 per meter. Additional development expenses would be Php 60,000 to subdivide and grade into 320 house löts, and another Php 32,000 for a hollow block fence and security gates. The second site consists of three lots, separately owned, with a total area of 18 hectares: 7 hectares at Php 25.00 a sq.m. 5 hectares at Php 21.00 a sq.m and 6 hectares at Php 14.00 a sq.m. The road system for this would be only 3,200 meters long at Php 100.00 per meter, but needs two box culverts each costing Php 25.000.00. Lot grading would be Php 35,000; fencing and security 8atës Phip 24,000. Assuming that all other facilities would cost the same in both sites, which of the two sites would you recommend based on cost of site development alone?

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