Automatic versus Manual Processing
Bartell's, a Seattle area drug store, operates an instore printing service for customers with digital cam
eras. The current service, which requires employees to download photos from customer cameras, has
monthly operating costs of $ plus $ per photo printed. Management is evaluating the desir
ability of acquiring a machine that will allow customers to download and make prints without employee
assistance. If the machine is acquired, the monthly fixed costs will increase to $ and the variable
costs of printing a photo will decline to $ per photo.
Required
a Determine the total costs of printing and photos per month:
With the current employeeassisted process.
With the proposed customer selfservice process.
b Determine the monthly volume at which the proposed process becomes preferable to costs less
than the current process.
