Chapter 27 - 27 Cost Management for Just-in-Time...

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1-1 27-1 27 Cost Management for Just-in-Time Environments Student Version
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1-2 27-2 1 Describe just-in-time manufacturing practices.
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1-3 27-3 JIT is a business philosophy that focuses on reducing time and cost and eliminating poor quality within manufacturing and nonmanufacturing processes. What is Just-in-Time (JIT)? 0 1 Sometimes called lean manu- facturing .
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1-4 27-4 Reducing Inventory Just-in-time manufacturing views inventory as wasteful and unnecessary. Under traditional manufacturing, inventory hides underlying production problems. 0 1
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1-5 27-5 Lead time , sometimes called throughput time , is a measure of the time that elapses between starting a unit of product and completing the unit of product. Reducing Lead Time 0 1
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1-6 27-6 Value-added lead time is the time spent in converting raw materials into a finished unit of product. Value-Added Lead Time 0 1
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1-7 27-7 Nonvalue-added lead time is the time spent while the unit of product is waiting to enter the next production process or is moved from one process to another. Nonvalue-Added Lead Time 0 1
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1-8 27-8 Value-Added Ratio 1 Value-Added Ratio Value-Added Lead Time Total Lead Time =
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1-9 27-9 A setup is the effort spent preparing an operation or process for a production run. If setups are long and costly, the batch size (number of units) for the related production run is normally large. Reducing Setup Time 0 1
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1-10 27-10 0 Automotive Components Inc. 1 Automotive Components Inc. manufactures engine starters as follows:
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1-11 27-11 0 1 Value-Added Ratio = Value-Added Lead Time Total Lead Time Value-Added Ratio = (7 + 9 + 8) minutes 985 minutes = 2.4% Automotive Components Inc.
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1-12 27-12 If the manufacturing process is organized around a product, it is called a product- oriented layout (or product cell ) .
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This note was uploaded on 01/31/2011 for the course BUS 101 taught by Professor Pernia during the Spring '10 term at Essex County College.

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Chapter 27 - 27 Cost Management for Just-in-Time...

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