Montegut Manufacturing produces a product for which the annual demand is 10000

# Montegut manufacturing produces a product for which

This preview shows page 6 - 9 out of 10 pages.

31.Montegut Manufacturing produces a product for which the annual demand is 10,000 units. Production averages 100 units per day, while demand is 40 units per day. Holding costs are \$2.00 perunit per year, and setup cost is \$200.00. (a) If the firm wishes to produce this product in economic batches, what size batch should be used? (b) What is the maximum inventory level? (c) How many order cycles are there per year? (d) What are the total annual holding and setup costs? A)=SQRT((2*10000*200)/(2*(1-(40/100)))) = 1826 unitsB)=1826*(1-(40/100)) = 1095 unitsC)=10000/1826 = 5.48 order cyclesD)=(5.48*200)+((1095/2)*2) = \$2191 costs 32. Your company has compiled the following data on the small set of products that comprise the specialty repair parts division. Perform ABC analysis on the data. Which products do you suggest the firm keep the tightest control over? Explain.SKUAnnualDemandUnitCostR11250\$250 \$62,500 62.22%1TightestS2275\$90 \$6,750 6.72%4T3320\$60 \$1,200 1.19%5U44150\$150 \$22,500 22.40%2V55100\$75 \$7,500 7.47%3\$100,450 Because R11 has the highest sales volume, it should have the tightest control over. Then after R11, it should be U44, then V55, then S22, and lastly T33.33.The following data are pulled from a recent Walsh Manufacturing annual report.AssetsRaw material inventory\$120,000Work-in-process inventory\$50,000
MGMT 461 – OPERATIONS MANAGEMENTEXAM 3Finished goods inventory\$300,000Property, plant & equipment\$500,000Other assets\$200,000Total assets\$1,170,000Condensed Income StatementRevenue\$2,000,000Cost of goods sold\$600,000Other expenses\$1,000,000Net income\$400,000Calculate:Percent invested in inventory =40.17%(120,000 + 50,000 + 300.000) / 1,170,000Inventory Turnover =1.28600,000 / (120,000 + 50,000 + 300,000)Weeks of Supply =40.73(120,000 + 50,000 + 300,000) / (600,000 / 52)34.Sample observations of a claims processor made over a 160-hour work month reveal that the workerproduced a total of 384 completed claims forms. The performance rating was 80%. The worker was idle 20% of the time (so that idle time should be subtracted from the total time when computing the average observed time). The allowance factor is 8%. What is the normal time per unit?160 / 384 = 0.4170.417 * 60 = 2525 * 0.8 = 2020 – (20 * 0.2) = 16 seconds (Normal Time)What is the standard time per unit?16 / (1 – 0.08) = 17.4 seconds (Standard Time)35.A Methods and Measurements Analyst needs to develop a time standard for a certain task. The task involves use of a ruler, square, and portable electric saw to mark and cut the "notch" in a rafter (a standard carpentry task of home construction). In a preliminary study, he observed one of his workers performing this task five times. The observations were made in an air-conditioned, well-lit training facility, at ground level, with all tools and equipment clean and readily available.Observation:12345Task time (seconds):8274808376a.What is the actual average time for this task?(82 + 74 + 80 + 83 + 76) / 5 = 79 seconds
MGMT 461 – OPERATIONS MANAGEMENTEXAM 3b.What is the normal time for this task if the employee worked at a 20% faster pace than is typical for adequately trained workers?

#### You've reached the end of your free preview.

Want to read all 10 pages?