Jackson Fabricators Inc. machines metal partS TOI he dutomove mOusuryUnu e two processes: milling and finishing. Parts are produced in batch slzes of 60 parts, A part requires 3 minutes in milling and 9 minutes in finishing. The move time between the two operations for a complete batch is 10 minutes. Under the lean philosophy, the part is produced in a cell that Includes both the milling and finishing operations. The operating time is unchanged; however, the batch size is reduced to 5 parts and the move time is eliminated. Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the traditional and lean manufacturing methads. If required, round percentages to one decimal place.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Lead Time: Lead time is the time consumed for the creation of a product. It refers to the time period between the time the order is placed and the product is completed. Lesser lead time creates a more competitive edge for the company.
Lead Time = Wait time + Process time + Queue time + Move time + Inspection Time
Value added activities: The value added activities are the activities which add to the value of a product.
Non value added activities: The non-value added activities are the activities which a customer may think unnecessary and tend to reduce the value of a product.
The value added, non-value added activities and total lead time, and the value added ratio under the traditional and lean manufacturing method.
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