**Compute Lead Time**Williams Optical Inc. is considering a new lean product cell. The present manufacturing approach produces a product in four separate steps. The production batch sizes are 45 units. The process time for each step is as follows:- **Process Step 1:** 5 minutes- **Process Step 2:** 8 minutes- **Process Step 3:** 4 minutes- **Process Step 4:** 3 minutesThe time required to move each batch between steps is 5 minutes. In addition, the time to move raw materials to Process Step 1 is also 5 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 5 minutes.The new lean layout will allow the company to reduce the batch sizes from 45 units to 3 units. The time required to move each batch between steps and the inventory locations will be reduced to 2 minutes. The processing time in each step will stay the same.**Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the present and proposed production approaches. If required, round percentages to one decimal place.**| | Present Approach | Proposed Approach ||-----------------------------|------------------|-------------------|| Value-added time | | || Non-value-added time | | || Total lead time | | || Value-added ratio (as a percent) | | |**Explanation:**The text is accompanied by a table meant to calculate different aspects of lead time: value-added time, non-value-added time, total lead time, and value-added ratio for both current and proposed methods.- **Value-added time**: Time spent directly contributing to manufacturing.- **Non-value-added time**: Time spent on other activities, such as moving products.- **Total lead time**: Sum of value-added and non-value-added times.- **Value-added ratio**: Percentage of value-added time over total lead time. Note: Calculations are required to complete the table based on process improvements described.

Formulas used here:- a) In the exercise for Present:- Value-added processing time = Add together Process steps 1-4 Non-value-added time = Total within-batch wait time + Move time, where Total Within-Batch Wait Time = (Total Time to Perform Operations) x (Batch Size - 1) Add value-added processing time + non-value-added processing time to obtain total processing time. Calculate Value-Added Ratio = Value-Added Time ÷ Total lead Time b) In this exercise for Proposed:- Value-added processing time = Add together Process steps 1-4 Non-value-added time = Total within-batch wait time + Move time, where Total Within-Batch Wait Time is obtained by multiplying the process time by the remaining units in the batch (waiting their turn) Add value-added processing time + non-value-added processing time to obtain total processing time. Calculate Value-Added Ratio = Value-Added Time ÷ Total lead Time Present Proposed Value- added time 20 20 Non Value added time 905 50 Total lead time 925 70 Value added ratio 20/925=2.2% 20/70= 28.6%

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Compute Lead Time Williams Optical Inc. is considering a new lean product cell. The present manufacturing approach produces a product in four separate steps. The production batch sizes are 45 units. The process time for each step is as follows: Process Step 1 Process Step 2 Process Step 3 Process Step 4 5 minutes 8 minutes 4 minutes 3 minutes The time required to move each batch between steps is 5 minutes. In addition, the time to move raw materials to Process Step 1 is also 5 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 5 minutes. The new lean layout will allow the company to reduce the batch sizes from 45 units to 3 units. The time required to move each batch between steps and the inventory locations will be reduced to 2 minutes. The processing time in each step will stay the same.

Compute Lead Time Williams Optical Inc. is considering a new lean product cell. The present manufacturing approach produces a product in four separate steps. The production batch sizes are 45 units. The process time for each step is as follows: Process Step 1 Process Step 2 Process Step 3 Process Step 4 5 minutes 8 minutes 4 minutes 3 minutes The time required to move each batch between steps is 5 minutes. In addition, the time to move raw materials to Process Step 1 is also 5 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 5 minutes. The new lean layout will allow the company to reduce the batch sizes from 45 units to 3 units. The time required to move each batch between steps and the inventory locations will be reduced to 2 minutes. The processing time in each step will stay the same.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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