Q) Maria Enterprise makes a variety of consumer electronic products. Its camera manufacturing plant is considering choosing between two different processes, named A and B, which can be used to make two parts: Part 1 and Part 2. To make the correct decision, the managers would like to compare the labour and total productivity of process A with that of process B. Find labour and total productivity of both processes and find which process is better than the other. The data is given in the table No. of Product Labour cost per part Material cost per part Part 1 Part 2 Part 1 Part 2 Part 1 Part 2 Process A 50 60 25 30 60 70 Process B 30 80 30 40 50 55 Output value for each part and overhead cost for each process are given in the below Part 1 Part 2 Process A Process B Output Value per part 200 150 Overhead cost per process 6000 5000 Q) In above question, we want to make both processes to have exactly the same total productivity (the higher productivity of two options). It is found that only way to do so is to decrease the labour cost per part for Part 2. What is the amount of decrease to make the total productivity of both processes exactly the same?

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.3SD: Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling...

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Q) Maria Enterprise makes a variety of consumer electronic products. Its camera manufacturing plant is considering choosing between two different processes, named A and B, which can be used to make two parts: Part 1 and Part 2. To make the correct decision, the managers would like to compare the labour and total productivity of process A with that of process B. Find labour and total productivity of both processes and find which process is better than the other. The data is given in the table

	No. of Product	Labour cost per part	Material cost per part
	Part 1	Part 2	Part 1	Part 2	Part 1	Part 2
Process A	50	60	25	30	60	70
Process B	30	80	30	40	50	55

Output value for each part and overhead cost for each process are given in the below

Part 1

Part 2

Process A

Process B

Output Value

per part

200

150

Overhead cost

per process

6000

5000

Q) In above question, we want to make both processes to have exactly the same total productivity (the higher productivity of two options). It is found that only way to do so is to decrease the labour cost per part for Part 2. What is the amount of decrease to make the total productivity of both processes exactly the same?

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