Question

1.

Assume that a company takes 10,000 hours to produce 50,000 units of a product. What is the velocity for the company?

a.2 units per hour

b.3.5 units per hour

c.5 units per hour

d.2.5 units per hour

e.1 unit per hour

2.

The activity driver for the shipping activity of Withstand Inc. is the number of orders shipped. Product A uses 30 orders, and Product B uses 70 orders. Calculate the consumption ratios for each product. (Note: Round answer to two decimal places.)

a.0.25; 0.75

b.0.20; 0.80

c.0.30; 0.70

d.0.65; 0.35

Answer 1

Determine the velocity of the company as follows: Velocity Cycle time 10,000 50.000 1 = 5 units per hour Thus, correct answer is c. Compute consumption ratio for product A as follows: Orders for Product A Consumption ratio = Total number of orders 30 30+70 = 0.30 Compute consumption ratio for product B as follows: Orders for Product B Consumption ratio = Total number of orders 70 30+70 = 0.70 Thus, correct answer is c.