of these units must be processed by Macon Controls produces three different types of control units used to protect industrial equipment from overheating. nachine that Macon considers to be their process bottleneck. The plant operates on two 8-hour shifts, 5 days per week, 52 weeks per year. The table below provides the ime standards at the bottleneck, lot sizes, and demand forecasts for the three units. Because of demand uncertainties, the operations manager obtained three demand orecasts (pessimistic, expected, and optimistic). The manager believes that a 25 percent capacity cushion is best. D Demand Forecast Component A B C Time Standard Processing (hr/unit) 0.04 0.20 0.05 Setup (hr/lot) 1.0 4.4 8.5 Lot Size (units/lot) 50 75 100 Demand Forecast Pessimistic 16,000 10,000 18,000 Pessimistic Expected . How many machines are required to meet minimum (Pessimistic) demand, expected demand, and maximum (Optimistic) demand? (Enter your responses rounded up o the next whole number.) Capacity Requirement (M) Expected 17,000 12,000 24,000 machines machines Optimistic 27,000 17,000 35,000
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- Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?Jefferson Company’s demand for its only product exceeds its manufacturing capacity. The company provided the following information for the machine whose limited capacity is prohibiting the company from producing and selling additional units. Actual run time this week 6,106 minutes Machine time available per week 8,600 minutes Actual run rate this week 4.32 units per minute Ideal run rate 6.00 units per minute Defect-free output this week 11,315 units Total output this week (including defects) 15,500 units 1. Compute the utilization rate.2. Compute the efficiency rate. 3. Compute the quality rate. 4. Compute the overall equipment effectiveness (OEE).A manager must decide which type of machine to buy, A, B, or C. Machines costs are as follows: Machine Cost A $40,000 B $30,000 C $80,000 Product forecast, processing times on the machines, and setup times are as follows: Processing Time Per Unit (minutes) Product Annual Demand A B C Setup Times (minutes) Production Lots (units) 1 16,000 3 4 2 20 200 2 12,000 4 5 3 35 100 3 6,000 5 6 3 60 50 4 30,000 2 4 1 15 500 Machines operate 10 hours a day, 250 days a year. The manager wants to have a capacity cushion of 10%. a. Assume that only purchasing costs are being considered. Which machines would have the lowest total cost, and how many of that machines would be needed? b. Consider this additional information: The machines differ in terms of hourly operating costs: The A machines have an hourly operating cost of $11 each, B machines have an hourly operating cost of $10 each, and C machines have an hourly operating cost of $12 each. Which alternative would…
- The Amberssen Specialty Company is a chain of 12 retail stores that sell a variety of imported gift items, gourmet chocolates, cheeses, and wines in the Toronto area. Amberssen has an IS staff of three people who have cre- ated a simple, but effective, information system of networked point-of-sale registers at the stores, and a cen- tralized accounting system at the company headquarters. Harry Hilman, the head of Amberssen’s IS group, hasjust received the following memo from Bill Amberssen, Sales Director (and son of Amberssen’s founder): Harry—It’s time Amberssen Specialty launched itself on the Internet. Many of our competitors are already there, selling to customers without the expense of a retail storefront, and we should be there too. I project that we could double or triple our annual revenues by selling our products on the Internet. I’d like to have this ready by Thanksgiving, in time for the prime holiday gift-shopping season. Bill Make an case studyA small-size cargo company in Dubai has been operating since the year 2000. The total workforce comprises ten employees, out of which five are in sales, three are in operations, one is handling legal and accounts matters, and one manager is also the owner of the company. Total annual turnover is enough to run the company smoothly. Recently another director has joined who brought large investment to the company. The Board of directors has decided to expand the business in other cities and establish offices overseas in potential locations. This expansion policy will directly be linked to the new manpower needs. Therefore, the board has decided to open an HR department with one HR manager and three staff to look after HR operations. The new HR manager has noticed that the company has a very convenient way of recording the data, where all transactions are recorded on excel documents. “this may not work in the new setup with many branches around the world”, he mentioned in the BOD meeting.…A manager must decide which type of machine to buy, A, B, or C. Machine costs are as follows: Machine CostA $40,000B $30,000C $80,000Product forecasts and processing times on the machines are as follows: Processing Time per Unit (minutes) Product Annual Demand A B C 1 16000 3 4 2 2 12000 4 4 3 3 6000 5 6 4 4 30000 2 2 1 a.) Assume that machines operate 10 hours a day, 250 days a year. If we only consider purchasing costs, which machine would have the lowest total cost? b.) Assume machines operate 10 hours a day, 250 days a year. If we select machine A, how many machine A do we need? (Use common sense to decide the answer.)
- QuestionByron Sports is a manufacturer of sportswear. It produces all of its products in one department using a process costing system.The information for the current month is as follows:Beginning work in process (30% complete as to conversion cost) 12,000 unitsUnits started 90,000 unitsUnits completed and transferred out ?Ending work in process (70% complete as to conversion) 8,000 unitsCosts:Beginning work-in-process direct materials $28,800Beginning work-in-process conversion $5,040Direct materials added during month $216,000Conversion costs incurred during the month $139,200Direct materials are added at the beginning of the process. Conversion costs are incurred uniformlythroughout the production process. Costing is handled on a FIFO basis Required:a. Prepare a production cost worksheet using 5 steps approach.b. Under what conditions would a process costing system be more appropriate than a job order costing system? Explain.Spartan Castings must implement a manufacturing process that reduces the amount of particulates emitted into the atmosphere. Two processes have been identified that provide the same level of particulate reduction. The first process is expected to incur $350,000 of fixed cost and add $50 of variable cost to each casting Spartan produces. The second process has fixed costs of $150,000 and adds $90 of variable cost per casting.a. What is the break-even quantity beyond which the first process is more attractive?b. What is the difference in total cost if the quantity produced is 10,000?Deforrest Marine Motors manufactures engines for the speedboat racing circuit. As part of their annual planning cycle, they forecasted demand for the next four quarters. The number of available days of production and the anticipated demand are given below. Employees Production Rate Production Cost Backorder Cost Overtime Cost Overtime Limit Demand Q1 2,400 6,019,000 They also estimated many of the costs required to conduct operations planning. Some of these key figures are listed below. 30 70 units/employee/quarter Q2 2,200 $1,000/unit $200/unit/quarter $1,500/unit <= 25% of Reg. Production Q3 1,700 Q4 1,800 Hire Cost Fire Cost Subcontracting Cost Subcontracting Limit Inventory Cost Initial Inventory $1,200/employee $800/employee $1,800/unit 400 units maximum $100/unit/quarter 280 units Deforrest Marine Motors wishes to maintain the current number of employees for the entire year to follow a level strategy balanced with inventory and backorders as needed. What is the total cost of this…
- With 30 employees and a location in Huston in Zimbabwe's Bompata area, ZARA STORES is a prominent family grocery and clothing retail business outlet that faces widespread pilfering from its own employees as well as shoplifting from its many clients. The business operations activities at the ZARA shop are carried out manually in the surrounding area. It is, however, a regular occurrence at the store for goods shipped to go missing without a trace, as well as for daily sales to go missing without a trace. As a result, Mr. Adwenpa, the shop owner, has suffered a substantial loss in income and is urgently seeking an expedient solution to the terrible pilfering activities at the business in order to boost profits from his sales transactions. What are the systems analysis and design concepts that you would use to offer a bespoke IT/IS solution to ZARA STORES if you were hired as a freshly hired systems analyst by the shop owner? 2.Please offer IT/IS solutions for the ZARA STORES and provide…Macnamara Corporation has two manufacturing departments--Casting and Finishing. The company used the following data at the beginning of the year to calculate predetermined overhead rates: Casting Finishing Total Estimated total machine-hours (MHs) 1,000 4,000 5,000 Estimated total fixed manufacturing overhead cost $ 4,800 $ 8,800 $ 13,600 Estimated variable manufacturing overhead cost per MH $ 1.80 $ 2.90 During the most recent month, the company started and completed two jobs--Job F and Job M. There were no beginning inventories. Data concerning those two jobs follow: Job F Job M Direct materials $ 11,500 $ 9,000 Direct labor cost $ 18,400 $ 7,400 Casting machine-hours 700 300 Finishing machine-hours 1,600 2,400 Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. The manufacturing overhead applied to Job F is closest to: $4,620…For nearly 20 years, Cullumber Coatings has provided painting and galvanizing services for manufacturers in its region. Manufacturers of various metal products have relied on the quality and quick turnaround time provided by Cullumber Coatings and its 20 skilled employees. During the past year, as a result of a sharp upturn in the economy, the company’s sales have increased by 30% relative to the previous year. The company has not been able to increase its capacity fast enough, so Cullumber Coatings has had to turn work away because it cannot keep up with customer requests.Top management is considering the purchase of a sophisticated robotic painting booth. The booth would represent a considerable move in the direction of automation versus manual labour. If Cullumber Coatings purchases the booth, it would most likely lay off 15 of its skilled painters. To analyze the decision, the company compiled production information from the most recent year and then prepared a parallel compilation…