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Chapter 2: Q.11-50Q (page 288)

Question: A firm has redesigned its production process so that it now takes 10 hours for a unit to be made. Using the old process, it took 15 hours to make a unit. If the process makes one unit each hour on average and each unit is worth $1,500, what is the reduction in work-in-process value?

Short Answer

Expert verified

Answer

The information provided about the process is as follows:

Previous production time to make a single unit =15 hours

Present production time to make a single unit =10 hours

Step by step solution

01

The work in progress in the initial and final stages is

Work in progress (WIP) = Flow rate x Cycle time

Final WIP = (1 In per hour) x 15 hour = 15

Initial WIP = (1 In per hour) x 10 hour = 10

02

The value of the work in progress is

Initial WIP Value = 10 x 1500= 15,000

Final WIP Value = 15 x 1500= 25,500

03

The reduction in work process value is

Reduction in WIP = 22,500-15,000

= $ 7,500

Hence, the reduction in work in process value is $7,500

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Most popular questions from this chapter

Question: A customer call center is evaluating customer satisfaction surveys to identify the most prevalent quality problems in their process. Specific customer complaints have been analyzed and grouped into eight different categories. Every instance of a complaint adds to the count in its category. Which six sigma analytical tool would be most helpful to management here?

The application of control charts is straightforward in manufacturing processes when you have tangible goods with physical characteristics you can easily measure on a numerical scale. Quality control is also important in service businesses, but you are generally not going to want to measure the physical characteristics of your customers! Do you think control charts have a place in service businesses? Discuss how you might apply them to specific examples.

Question: The flow of materials through eight departments is shown on the next page. Even though the table shows flows into and out of the different departments, assume that the direction of flow is not important. In addition, assume that the cost of moving material depends only on the distance moved.

a. Construct a schematic layout where the departments are arranged on a 2 x 4 grid with each cell representing a 10 x 10-meter square area.

b. Evaluate your layout using a distance-times-flow measure. Assume that distance is measured rectilinearly (in this case, departments that are directly adjacent are 10 meters apart and those that are diagonal to one another are 20 meters apart).

Question:Resistors for electronic circuits are manufactured on a high-speed automated machine. The machine is set up to produce a large run of resistors of 1,000 ohms each. To set up the machine and to create a control chart to be used throughout the run, 15 samples were taken with four resistors in each sample. The complete list of samples and their measured values are as follows:

Sample number
Readings

1

1010

991

985

986

2

995

996

1009

994

3

990

1003

1015

1008

4

1015

1020

1009

998

5

1013

1019

1005

993

6

994

1001

994

1005

7

989

992

982

1020

8

1001

986

996

996

9

1006

989

1005

1007

10

992

1007

1006

979

11

996

1006

997

989

12

1019

996

991

1011

13

981

991

989

1003

14

999

993

988

984

15

1013

1002

1005

992

Develop an x-chart and an R-chart and plot the values. From the charts, what comments can you make about the process? (Use three-sigma control limits as in Exhibit 13.7.)

Question: Burrito King (a new fast-food franchise opening up nationwide) has successfully automated burrito production for its drive-up fast-food establishments. The Burro-Master 9000 requires a constant 45 seconds to produce a batch of burritos. It has been estimated that customers will arrive at the drive-up window according to a Poisson distribution at an average of one every 50 seconds. To help determine the amount of space needed for the line at the drive-up window, Burrito King would like to know the expected average time in the system, the average line length (in cars), and the average number of cars in the system (both in line and at the window).
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