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The Baldwin company wants to decrease its plant utilization for Buddy by 15%. How many units...

Question:

The Baldwin company wants to decrease its plant utilization for Buddy by 15%. How many units would need to be produced next year to meet this production goal? Ignore impact of accounts payable on plant utilization.

A. 1,322

B. 1,811

C. 1,556

D. 1,683

Production Goal:

The goal of production refers to satisfaction from the product and services and their requirement. It deals with the volume of production, which shows the compromise between the future demand and supply of the goods and services, it helps in accomplishing the advantage by the manufacturer for increasing the efficiency from the resources.

Answer and Explanation:

Decrease in the plant utilization for a buddy by 15%

The utilization of plant by buddy is 96%

Decrease in plant utilization = 96%-15%

= 81%

Let the no.of produced unit be x

The number of unit produced is calculated as

Plant Utilization = Units Produced/ Plant Capacity

81%= X/1500units

X= 1500*0.81

=1215 units

The number of unit produced is 1215 units.


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