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$15per unitDaily production992units/8 hour dayAnnual demand36,000(250dayseach×dailydemand of144units)Desired lot size124units (one hour of production)To obtain the desired lot size, the set-up time that should be achieved =nothingminutes (round your response to two decimal places).

What is the set up time? Set up time can be characterized as the measure of time taken to change a…

Answered: inventory turnover

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	$15 per unit
Daily production	992 units/8 hour day
Annual demand	36,000 (250 days each×daily demand of 144 units)
Desired lot size	124 units (one hour of production)

To obtain the desired lot size, the set-up time that should be achieved =

nothing

minutes (round your response to two decimal places).

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