Question

Cycle Time and velocity, MCE Computador has a manufacturing plant in Des Moines that has the theoretical capability to produce 260,000 laptops per quarter but currently produces 78,000 units. The conversion cost per quarter is $8,190,000. There are 65,000 produ the processing minutes per unit used, the production of the laptops uses 9 minutes of move time, 21 minutes of wait time, and 6 minutes of rework time. (All work is done by cell workers.) Required: 1. Compute the theoretical and actual velocities (per hour) and the theoretical and actual cycle times (minutes per unit produced). If required, round to one decimal place. Velocity 4 15 Theoretical laptops per hour minutes per laptop 1.2 50 Actual laptops per hour minutes per laptop Cycle time 2. Compute the ideal and actual amounts of conversion cost assigned per laptop. If required, round your answers to the nearest cent. ) Assignment per unit (theoretically) $ $ 31.5 105 Assignment per unit (actual) 3. Calculate MCE. If required, round your answer to two decimal places.

Answer 1

3. MCE = Processing Time / (Processing Time + Move Time +Inspection Time +Waiting Time +Other non-value added time)

= 50 / (50+9+21+6)

= 0.58