Cook Composite And Polymers Co Case Solution

1. Alternative Analysis in Terms of Cost

Currently, the financial managers are tackling some issues which are predominantly related to the handling of styrene to use in rinsing the mixers and vessels. Currently, the company had three options which are need to be evaluated in terms of cost so that company managers can be in a sound position to make a decision which can benefit the company in the long run. The first option is to go with the status quo approach which is to use the by-product as a fuel in the Kilns and reduce the reduction of the original fuel. Hence, the optimal result would be the fuel cost reduction.

In Appendix A, the cost of this option in evaluated. First of all, the total pounds of styrene which will be used are calculated. This is done because of the reason that the total cost of the procurement and disposal is needed. Therefore, it is mandatory that the total batches produced in a year must be calculated so that the batches can be used to calculate the total cost. The operational time of plant is used to calculate the total available hours in a year. The total operational hours are obtained when the total hours in a day are adjusted for a number of days in a week and the shutdown period in a year. The total operational hours in a year comes out to be 5520 as evident by Appendix A. It takes 2 hours to make a batch of 10 gallons which means the total hours in a year is divided by 2 to get the total batches in the year. The calculation of the time required to make a batch is given in Appendix 1 which includes the time required for different activities such as preparation time, quality assessment, transfer of waste material and filling and rinsing.