Question

A Missouri job shop has four departments—machining (M), dipping in a chemical bath (D), finishing (F), and plating (P)-assigned to four work areas. The operations manager, Mary Marrs, has gathered the following data for the movement of material. The number of workpieces moved yearly between work areas are: |: DFP 700 1,900 400 - 500 300 - 1,800 ס ד ס It costs $0.75 to move 1 workpiece 1 foot in the job shop. For the layout design of the job shop, Mary has the current layout (Plan A) and two proposals (Plan B and Plan C). a) LAYOUT PLAN A: Distance between work areas (departments) in feet: - M D F P. : ס ד ס The yearly total material handling cost of the current layout presented in PLAN A = $ (enter your response as a whole number).

Answer 1

Solution:

The yearly total material handling cost is calculated as,

Total material handling cost = Sum of (Number of workpieces moved yearly between work areas x Distance between work areas) x Cost of moving 1 workpiece 1 foot in the job shop

(a) Plan A:

Total material handling cost = [(700 x 22) + (1900 x 11) + (400 x 7) + (500 x 6) + (300 x 9) + (1800 x 3)] x $0.75

Total material handling cost = 50,200 x $0.75

Total material handling cost = $37,650

(b) Plan B:

Total material handling cost = [(700 x 22) + (1900 x 7) + (400 x 11) + (500 x 9) + (300 x 6) + (1800 x 3)] x $0.75

Total material handling cost = 44,800 x $0.75

Total material handling cost = $33,600 (lowest)

(c) Plan C:

Total material handling cost = [(700 x 22) + (1900 x 9) + (400 x 6) + (500 x 7) + (300 x 11) + (1800 x 3)] x $0.75

Total material handling cost = 47,100 x $0.75

Total material handling cost = $35,325

(d) From the above calculations, Plan B has the lowest yearly total material handling cost. Therefore, it is the best plan.

The best layout from the cost perspective is Plan B.