Umberger Manufacturing, Inc

Multiple Choice

Umberger Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization:
Inventory carrying costs are estimated to be 10% per year.
-As a result of switching to a cellular manufacturing operation,total benefits are projected to increase annually by:

A) $216,500.
B) $200,000.
C) $183,500.
D) $176,500.