. What is a production constraint? a. The point in the manufacturing process where the demand...
The point in the production process where joint products become separable is called the joint cost point split-off point separation point joint process point
IPort Products makes cases for portable music players in two processes, cutting and sewing. The cutting process has a capacity of 100,000 units per year; sewing has a capacity of 120,000 units per year. Cost information follows. Inspection and testing costs $ 40,000 Scrap costs (all in the cutting dept.) 140,000 Demand is very strong. At a sales price of $12.00 per case, the company can sell whatever output it can produce. IPort Products can start only 100,000 units into...
A fire recently destroyed a substantial portion of Sheridan Company's production capacity. It will be many months before capacity can be restored. During this period, demand for the firm's products will exceed the company's ability to produce them. Per-unit data on the firm's three major products is summarized as follows: Product Selling price Variable costs Fixed costs Operating profit A $83 40 15 $28 B с $92 $74 23 27 20 11 $49 $36 Fixed costs have been allocated to...
Quant Changa is the supervisor of a production department in a vehicle manufacturing company. Quant must decide how many sedans and how many SUV's to produce per week. The profit on the sedans is $10K per vehicle and the SUV's profit is $18K. Each type of vehicle goes through a manufacturing process and a painting process. There are only 6000 minutes available for the manufacturing processes and only 4800 minutes available for the painting processes. Each sedan requires 20 minutes...
Soft and Cuddly Friends (SCF) produces soft dolls. Demand for the dolls is increasing, and management wants you to identify an economical sales and production mix for the coming year. The following information is available: 505030 50 50 50 50 450 200 The following additional information is available: The company's plant has a capacity of 130.000 direct labour- hours per year on a single-shift basis. The company's present employees and equipment can produce all five products The direct labour rate...
Suppose a manufacturing firm has two factories (Factory 1 and Factory 2), and a single production process (Process A) that is used in both factories. A new process (Process B) is developed that potentially reduces production costs. To test whether Process B is less costly than Process A, an experiment is designed where: Within each Factory, products are assigned randomly to Process A or Process B. Production costs for each product are recorded. Note that resources (i.e. materials, workers, equipment)...
Zando Pharmaceuticals is an affiliate of the German-based Heisenberg Corporation, which employs 40,000 worldwide. Zando’s St. Louis facility houses the U.S. corporate headquarters and Research and Development (R&D). It produces 30 products, using 28 different batch processes. The facility has 2,000 employees on-site. In recent years, Zando’s profitability has suffered, which can be attributed to increased competition, customer dissatisfaction, and regulatory pressures. Luis Alvarado, president of Zando, called a meeting to consider ways to improve profitability. He labeled the meeting...
A manufacturing process costs RM6,500 to set up for one year’s use. If items cost RM85 each to produce and other costs amount to 3.5x^2, where x is the production in hundreds, find the level of production that will minimise the cost per item over the year. What will the total cost amount to at this level of production ?
29. Which of the following is the objective of the theory of constraints? a. maximize throughput contribution while maximizing investments and operating costs. b. minimizing throughput contribution while minimizing investments and operating costs. c. minimizing throughput contribution while maximizing investments and operating costs. d. maximize throughput contribution while minimizing investments and operating costs. 30. The use of total quality management and flexible manufacturing practices to reduce setup costs enhances a company's ability to use a. economic order quantity methods. b. just-in-time...
Consider a textile manufacturing firm that uses labor and capital inputs and has the production technology given by the equation Q = 8K0.25L 0.5 , where Q is output, K is capital and L is labor. Each unit of capital costs 10 TL while each unit of labor costs 5 TL. a) Does this firm have increasing, decreasing or constant returns to scale? (1) b) Define the cost minimization problem faced by firm. What is the objective function, what is...