Management of Mittel Company would like to reduce the amount of time between when a customer places an order and when the order is shipped. For the first quarter of operations during the current year the following data were reported: Inspection time Wait time (from order to start of production) Process time 0.3 days 14.0 days 2.7 days 1.0 days 5.0 days Move time Queue time Required: 1. Compute the throughput time. 2. Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your percentage answer to nearest whole percent.) 3. What percentage of the throughput time was spent in non-value-added activities? (Round your percentage answers to the nearest whole percent.)

Cornerstones of Cost Management (Cornerstones Series)
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Chapter4: Activity-based Costing
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Management of Mittel Company would like to reduce the amount of time between when a customer places an order and when the
order is shipped. For the first quarter of operations during the current year the following data were reported:
Inspection time
Wait time (from order to start of production)
0.3 days
14.0 days
2.7 days
1.0 days
5.0 days
Process time
Move time
Queue time
Required:
1. Compute the throughput time.
2. Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your percentage answer to nearest whole percent.)
3. What percentage of the throughput time was spent in non-value-added activities? (Round your percentage answers to the nearest
whole percent.)
4. Compute the delivery cycle time.
5. If by using Lean Production all queue time during production is eliminated, what will be the new MCE? (Round your percentage
answer to 1 decimal place.)
days
%
1. Throughput time
2. Manufacturing cycle efficiency
3. Non-value-added throughput time
4. Delivery cycle time
5. New manufacturing cycle efficiency
%
days
Transcribed Image Text:Management of Mittel Company would like to reduce the amount of time between when a customer places an order and when the order is shipped. For the first quarter of operations during the current year the following data were reported: Inspection time Wait time (from order to start of production) 0.3 days 14.0 days 2.7 days 1.0 days 5.0 days Process time Move time Queue time Required: 1. Compute the throughput time. 2. Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your percentage answer to nearest whole percent.) 3. What percentage of the throughput time was spent in non-value-added activities? (Round your percentage answers to the nearest whole percent.) 4. Compute the delivery cycle time. 5. If by using Lean Production all queue time during production is eliminated, what will be the new MCE? (Round your percentage answer to 1 decimal place.) days % 1. Throughput time 2. Manufacturing cycle efficiency 3. Non-value-added throughput time 4. Delivery cycle time 5. New manufacturing cycle efficiency % days
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