Operations Management
13th Edition
ISBN: 9781259667473
Author: William J Stevenson
Publisher: McGraw-Hill Education
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Chapter 10, Problem 18P
A production process consists of a three-step operation. The scrap rate is 10 percent for the first step and 6 percent for the ether two steps
a. If the dewed duly output IS 450 units, how many units must be started to allow for loss due to scrap?
b. If the scrap rate for each step could be cut in half how many units would this save in terms of the scrap allowance?
C. If the scrap represents a cost of $10 per unit how much is it costing the company per day for the original scrap rate?
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At Fraser engineering. Erix is trying to decide whether to purchase a certain part to to have it produced internally. Internal production could use either of two processes. One would entail a variable cost per unit of $17, and an annual fixed cost of $240,000. Three vendors are willing to provide the part.
Vendor A has a price of $20 per-unit for any volume up to 30,000 units
Vendor B has a price of $22 per-unit for demand of 1,000 units or less, and $18 per-unit for larger quantities.
Vendor C offers a price of $21 per-unit for the first 1,000 units, and $19 for each additional unit.
What is the correct formula to use to compare these options?
Which options would be best for:
I. 10,000 units?
ii. 20,000 units?
iii. 100,000 units?
What is the value in considering these options across three very different demand values ranging from 10,000 to 100,000 units?
H4.
Explain properly and show all calculation steps
A production process consists of a three-step operation. The scrap rate is 13 percent for the first step and 12 percent for the other two
steps.
a. If the desired daily output is 455 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate
calculations. Round up your final answer to the next whole number.)
Number of units
b. If the scrap rate for each step could be cut in half at every operation, how ma units would this save in terms of the scrap
allowance? (Do not round intermediate calculations. Round up your final answer to the next whole number.)
Number of units
c. If the scrap represents a cost of $10 per unit, how much is it costing the company per day for the original scrap rate (i.e. the Part a
scrap rate)? (Round your final answer to the nearest whole number.)
Cost
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Chapter 10 Solutions
Operations Management
Ch. 10.2 - A potato chip is a delicate thing Fragile A pound...Ch. 10.2 - A potato chip is a delicate thing Fragile A pound...Ch. 10.5 - It's estimated that more than 7 000 hospital...Ch. 10.5 - It's estimated that more than 7 000 hospital...Ch. 10 - Prob. 1DRQCh. 10 - Prob. 2DRQCh. 10 - Prob. 3DRQCh. 10 - Prob. 4DRQCh. 10 - Prob. 5DRQCh. 10 - Prob. 6DRQ
Ch. 10 - Prob. 7DRQCh. 10 - Prob. 8DRQCh. 10 - Prob. 9DRQCh. 10 - Prob. 10DRQCh. 10 - Prob. 11DRQCh. 10 - Prob. 12DRQCh. 10 - Prob. 13DRQCh. 10 - Prob. 14DRQCh. 10 - Prob. 15DRQCh. 10 - Prob. 16DRQCh. 10 - Prob. 1TSCh. 10 - Prob. 2TSCh. 10 - Prob. 3TSCh. 10 - Prob. 1CTECh. 10 - Prob. 2CTECh. 10 - Prob. 3CTECh. 10 - Prob. 4CTECh. 10 - Prob. 1PCh. 10 - Prob. 2PCh. 10 - Prob. 3PCh. 10 - Prob. 4PCh. 10 - Prob. 5PCh. 10 - Prob. 6PCh. 10 - Prob. 7PCh. 10 - Prob. 8PCh. 10 - Prob. 9PCh. 10 - Prob. 10PCh. 10 - Prob. 11PCh. 10 - Prob. 12PCh. 10 - Prob. 13PCh. 10 - Prob. 14PCh. 10 - Prob. 15PCh. 10 - Prob. 16PCh. 10 - Prob. 17PCh. 10 - A production process consists of a three-step...Ch. 10 - Prob. 19PCh. 10 - Prob. 20PCh. 10 - Prob. 21PCh. 10 - Prob. 22PCh. 10 - Prob. 23PCh. 10 - Prob. 24PCh. 10 - Prob. 25PCh. 10 - Prob. 26PCh. 10 - Prob. 27PCh. 10 - Prob. 28PCh. 10 - Prob. 29PCh. 10 - Prob. 1.1CQCh. 10 - Prob. 2.1CQCh. 10 - Prob. 2.2CQCh. 10 - Prob. 2.3CQCh. 10 - Prob. 2.4CQ
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- Suppose the contracted volume changes to 275,000 gear housings. Based on the total cost, the process that is best suited for the new volume is ▼ DM FMS GPE .arrow_forwardWhich among the following is a non value adding activity? O a. Assembly of parts till the stage of inspection O b. Processing of material to finished goods O c. raw material cut into requred physical conditions O d. Storage of material required for manufacturingarrow_forwardes A production process consists of a three-step operation. The scrap rate is 16 percent for the first step and 9 percent for the other two steps. a.lf the desired daily output is 472 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate calculations. Round up your final answer to the next whole number.) Number of units b.lf the scrap rate for each step could be cut in half at every operation, how many units would this save in terms of the scrap allowance? (Do not round intermediate calculations. Round up your final answer to the next whole number.) Number of units c.if the scrap represents a cost of $10 per unit, how much is it costing the company per day for the original scrap rate (ie the Part a scrap rate)? (Round your final answer to the nearest whole number. Omit the "S" sign in your response.) Cost $arrow_forward
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