Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip: Setup labor cost$20per hourAnnual holding cost$13per unitDaily production992units/8 hour dayAnnual demand25,300(275dayseach×dailydemand of92units)Desired lot size124units (one hour of production)To obtain the desired lot size, the set-up time that should be achieved =minutes (round your response to two decimal places).

Formula to be used; S = Q2*H*(1-d/P) 2D Where; H Holding cost D Annual demand P…

Answered: Carol Cagle has a repetitive…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

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Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip:

Setup labor cost	$20 per hour
Annual holding cost	$13 per unit
Daily production	992 units/8 hour day
Annual demand	25,300 (275 days each×daily demand of 92 units)
Desired lot size	124 units (one hour of production)

To obtain the desired lot size, the set-up time that should be achieved =
minutes (round your response to two decimal places).

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