SCM300_Lab 4_supplementary doc
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Arizona State University, Tempe *
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Course
300
Subject
Industrial Engineering
Date
Dec 6, 2023
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2
Uploaded by kirstenkennett
SCM 300
Lab #4
PART 1: Supply Chain Shrinkage
Below is an overview of how materials move through the supply chain.
For each set of parties
listed you’ll also see a loss or defect rate associated with that portion of the supply chain.
A.
Suppliers:
1.0% of all materials delivered are unacceptable for use
B.
Manufacturing:
0.9% of items produced are defective and are thus not shipped
C.
Distribution:
1.1% of the items shipped are lost, stolen, or damaged in transit
D.
Retail Store:
1.2 % of items are stolen/damaged and thus unavailable for sale
Question #1
Using the calculation for damage and defects discussed in lecture, calculate the number of
standardized sets that must be planned for in order to have 7,500 sets available to the customer
each month.
Question #2
Based on our estimates, how many extra kitchen sets will need to be purchased/produced to
account for the damage, theft, defects…PER YEAR?
Question #3
The kitchen sets sell for $275.00 per set.
They cost about $200 to produce, deliver, and sell,
though.
Based on the number of additional items needed to account for shrinkage, wow much
will the company lose this year?
PART 2: Impact of Exchange Rates on Manufacturing
A European car company is trying to decide if they should manufacture their vehicles for the US
market in Europe, or in the United States.
Please do the calculations that will help this company
come to a decision.
Sale price of vehicle in the United States - $35,500
Cost to manufacture the car in Europe, deliver and import to US:
20,000 Euros
Cost to import the vehicle into the United States
$4,500
Cost to manufacture the vehicles in the United States - $28,500
Question #4
Suppose the exchange rate is near 1 Euro = $1.30.
What would be the profit for the European
car company (in Euros) if they manufactured their car in Europe?
Remember, they have to pay
the import tax.
Question #5
Suppose the exchange rate is near 1 Euro = $1.30.
What would be the profit for the European
car company (in Euros) if they manufactured their car in the United States?
Remember, they
avoid the import tax.
SCM 300
Lab #4
RELIABILITY
A certain company produces 8,000 tables per year in a three-step process.
The cost to produce
one table is $135.
The three steps in the process employ machines with the reliabilities listed here:
Step A - 0.985
Step B – 0.980
Step C – 0.860
Question #6
What is the reliability of the present process?
Provide reliability to three digits.
Question #7
How many defects does this process presently produce annually?
Round up to get a whole
number.
Question #8
The company can choose to buy a back-up machine for Step C for an additional $27,000.
The
back-up would also have a reliability of 0.860, just like the one that is presently used.
If they
decide to get this back-up machine, what will the new reliability of the
system
be?
Assume that
once a machine malfunctions, the process continues to produce product, acceptable and
defective.
THREE decimal places.
Question #9
With the back up in place, how many defects will the process produce annually given the same
demand rate?
Question #10
How much do they stand to save this year if the cost of the back-up machine is included in your
calculation?
Remember to include the cost of the back-up into your calculations.
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