Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN: 9781337115773
Author: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher: Cengage Learning
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Chapter 13, Problem 43E

Erba Inc. has the following departmental layout for producing an herbal supplement:

Chapter 13, Problem 43E, Erba Inc. has the following departmental layout for producing an herbal supplement: After a detailed , example  1

After a detailed study, the head of the plant’s industrial engineering department recommended that the following cellular manufacturing layout replace the current departmental structure:

Chapter 13, Problem 43E, Erba Inc. has the following departmental layout for producing an herbal supplement: After a detailed , example  2

Required:

  1. 1. Calculate the time required to produce a batch of 12 bottles using a batch processing departmental structure.
  2. 2. Calculate the time to process 12 units using cellular manufacturing.
  3. 3. How much manufacturing time will the cellular manufacturing structure save for a batch of 12 units?
  4. 4. How many units can the cell produce per hour, assuming the cell is producing on a continuous basis?
  5. 5. What must happen so that the cell can produce 12 units per hour, assuming the cell produces on a continuous basis?

1.

Expert Solution
Check Mark
To determine

Compute the time taken to produce 12 units in case of a traditional manufacturing layout.

Answer to Problem 43E

Total time taken is 444 minutes.

Explanation of Solution

Traditional manufacturing layout:

In a traditional manufacturing layout, each process is undertaken within a separate department. In this layout large batches are processed, incurring significant wait time and move time.

Computation of time taken by 12 units:

ParticularsMinutes
Wait time14
Add: Time taken in mixing department (12minutes×12units)144
Add: Move and wait time between mixing and heating department15
Add: Time taken in heating department (7minutes×12units)84
Add: Move and wait time between heating and encapsulating department30
Add: Time taken in encapsulating department (6minutes×12units)72
Add: Move and wait time between encapsulating and bottling department25
Add: Time taken in bottling department (5minutes×12units)60
Total time444

Table (1)

Therefore, total time taken is 444 minutes.

2.

Expert Solution
Check Mark
To determine

Compute the time taken to produce 12 units in case of a cellular manufacturing layout.

Answer to Problem 43E

Total time taken to produce 12 units in cellular manufacturing is 162 minutes.

Explanation of Solution

Computation of time taken by 12 units:

ParticularsMinutes

Time taken by first unit

(12 minute mixing+7minute grinding+6 minute encapsulating+5 minute bottling)

30

Time taken by second unit

(12minuteswaiting+12 minute mixing+7minute grinding+6 minute encapsulating+5 minute bottling)

42

Time taken by twelfth unit.

((12×11)minuteswaiting+12 minute mixing+7minute grinding+6 minute encapsulating+5 minute bottling)

162
Total time162

Table (2)

Therefore, total time taken to produce 12 units in cellular manufacturing is 162 minutes.

3.

Expert Solution
Check Mark
To determine

Compute the time saved in cellular manufacturing structure for a batch of 12 units.

Answer to Problem 43E

Time saved in cellular manufacturing structure for a batch of 12 units is 282 minutes.

Explanation of Solution

Computation of time saved in cellular manufacturing:

ParticularsMinutes
Total time taken in traditional/batch processing444
Total time taken in cellular processing162
Time saved (444162)282

Table (3)

Therefore, time saved in cellular manufacturing structure for a batch of 12 units is 282 minutes.

4.

Expert Solution
Check Mark
To determine

Compute the production rate in case of continuous operating.

Answer to Problem 43E

Production rate is 12 minutes per unit or 5 units per hour.

Explanation of Solution

There is a total of 12 minutes of waiting for each unit. In case, cell operates continuously and steadily, one unit would be produced after every 12 minutes. Therefore, it would take 144 minutes (12minutes×12units) to produce 12 units.

Therefore, production rate is 12 minutes per unit or 5 units (6012) per hour.

5.

Expert Solution
Check Mark
To determine

Explain the changes to be made so that the cell can produce 12 units per hour in case, cell produces on a continuous basis.

Answer to Problem 43E

Time taken by bottleneck activity should be 5 minutes.

Explanation of Solution

Computation of revised time taken by bottleneck activity:

Timetaken=MinutesinanhourNumberofunitsrequiredtobeproduced

Substitute 60 for minutes in an hour and 12 for the number of units required to be produced in the above formula.

Timetaken=60minutes12units=5minutesperunit

The incremental time taken by each unit should be 5 minutes, in order to produce 12 units per hour on an incremental basis. For this, maximum time taken by any process should be 5 minutes.

Therefore, to produce 12 units per hour, time taken by bottleneck activity should be 5 minutes.

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Chapter 13 Solutions

Managerial Accounting: The Cornerstone of Business Decision-Making

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