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Based on this information, Sinclair called a staff meeting to discuss a contingency plan for allocation of natural gas among the firm's products if...

This question was created from Quiz 1 Make up Ag Chem https://www.coursehero.com/file/12685473/Quiz-1-Make-up-Ag-Chem/

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What are the steps (using Excel QOM or data analysis) to determine which of Agri-Chem's complexes would be least affected by a gas curtailment?

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Based on this information, Sinclair called a staff meeting to discuss a contingency plan for allocation of natural gas among the
firm's products if curtailments became a reality. The specific objective was to minimize the impact on profitsa'overhead
contribution. Afier a week of study, the information in Table 1 was presented to Sinclair. Agri Chem's contract with Enerco specified a maximum of 90,000 x 103 cubic feet per day for its complexes. However,
curtailments are projected to be based on current usage, not on contractual maximums. Enerco projects curtailments in the range
of 20 to 40 percent. Table 1. Financial and Operational Data at Agri Chem Contribution Capacity Production Rate Natural Gas Usage Product ($fTon) (Tonsi'Dax) (% of Capacity) (1,000 Cu. Ft..r‘Ton}
Ammonia $80 1 ,5 00 80 3
Ammonium phosphate $120 600 90 10
Ammonium nitrate $ 140 700 ’3’0 1 2 Urea $ 140 200 80 l 2
Hydrofluoric acid $90 800 70 7
Chlorine $70 1,5 00 30 18 Caustic soda $60 1,600 80 20 Vinyl chloride monomer $90 1,400 60 14

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