Question

A production process consists of a three-step operation. The scrap rate is 12 percent for the first step and 8 percent for the other two steps. a.lf the desired daily output is 482 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate calculations. Round up your final answer to the next whole number.) Number of units b.lf the scrap rate for each step could be cut in half at every operation, how many units would this save in terms of the scrap allowance? (Do not round intermediate calculations. Round up your final answer to the next whole number.) Number of units c.lf the scrap represents a cost of $10 per unit, how much is scrap rate)? (Round your final answer to the nearest whole number. Omit the "$" sign in your response.) costing the company per day for the original scrap rate (i.e. the Part a Cost

Answer 1

a) Let initial units be 1000

With 12% loss = 1000*.88 = 880 units

With 8% loss = 880*.92 = 809.6

With 8% loss = 744.83

For 1 unit considering scrap loss = 1000/744.83

For 482 units = 482*1000/744.83

= 647.13

= 647 units

b) With 6% loss = 1000*.94 = 940 units

With 4% loss = 940*.96 = 902.4

With 4% loss = 866.304

For 1 unit considering scrap loss = 1000/866.304

For 482 units = 482*1000/866.304

= 556.386

= 556 units

c) Scrap cost at 10$ per unit = (647-482)*10 = 1650 $