Free Essay

Kriesten Cookies

In: Business and Management

Submitted By sweta091
Words 294
Pages 2
Process Flow Diagram

Wash, mix& spoon

Bake
Cooling
Packing
Accepting Payment
6 + 2 min per dozen

10 min per dozen
5 min per dozen
2 min per dozen
1 min per dozen

Q4: Because your baking trays can hold exactly one dozen cookies, you will produce and sell cookies by the dozen. Should yougive any discount for people who order two dozen cookies, three dozen cookies, or more? If so, how much? Will it take you anylonger to fill a two-dozen cookie order than a one-dozen cookie order?

Solution:
As the costs of ingredients and boxes of each dozen of cookies are the same so difference is the cost of time.
The time taken i) For one dozen order,
Total valuable time is 6 (wash &mix) +2(tray filling) + 1 (prepare bake) + 2(pack) + 1 (payment) = 12 min.

ii) For two dozen order,
Total valuable time is 6 (wash &mix) + [2(tray filling) + 1 (prepare bake) + 2(pack)] × 2 + 1 (payment) = 17min.

iii) For three dozen order,
Total valuable time is 6 (wash &mix) + [ 2(tray filling) + 1 (prepare bake) + 2(pack)] × 3 + 1 (payment) = 22min

Assuming cost of time is $100/hr
Cost for 1 dozen = 12/60 * 100 = $20, cost/ dozen = $ 20

Cost for 2 dozen = 17/60 * 100 = $28.33, cost/dozen = $14.165

Cost for 3 dozen = 22/60 * 100= $ 36.66, cost/dozen= $12.22

The cost of 2 or 3 dozen order is less than the one dozen order. So we should give a discount for people who order more cookies. For 2 dozen order, the discount can be up to $5.835 cheaper per dozen.For 3 dozen order, the discount can be up to $7.78 cheaper per dozen.

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