Explain how a dbr system would work for zaramar

Reference no: EM13948191

Zaramar Manufacturing produces two types of hydraulic cylinders (small and large). Both cylinders pass through four processes: cutting, welding, polishing, and paint- ing. With the exception of polishing, each of the processes employs 20 workers who work eight hours each day. Polishing employs 26 workers. The small cylinder sells for $80 per unit, and the large cylinder sells for $110 per unit. Materials is the only unit-level variable expense. The materials cost for the small cylinder is $40 per unit, and the materials cost for the large cylinder is $50 per unit. Zaramar's accounting system has provided the following additional information about its operations and products:

Resource Name	Resource Available		Small Cylinder Resource Usage*	Large Cylinder ResourceUsage*
Cutting labor	9,600	minutes	30 minutes	20	minutes
Welding labor	9,600	minutes	30 minutes	60	minutes
Polishing labor	12,480	minutes	30 minutes	30	minutes
Painting labor	9,600	minutes	20 minutes	30	minutes
Market demand:
Small cylinder	200	per day	1 unit		-
Large cylinder	100	per day	-	1	unit

*Per unit

Zaramar's management has determined that any production interruptions can be corrected within two days.

Required

1. Assuming that Zaramar can meet daily market demand, compute the potential daily profit. Now, compute the minutes needed for each process to meet the daily market demand. Can Zaramar meet daily market demand? If not, where is the bottleneck?

2. Determine the optimal mix and the maximum daily contribution margin (throughput).

3. Explain how a DBR system would work for Zaramar.

4. Suppose that the Engineering Department has proposed a process design change that will increase the polishing time for the small cylinder from 30 to 46 minutes per unit and decrease its welding time from 30 to 20 minutes per unit. The cost of process redesign would be $20,000. Evaluate this proposed change. What step in the TOC process does this proposal represent?

Reference no: EM13948191

Questions Cloud

What type of planning will be necessary : With the announced expansion of Disney's Hong Kong Disneyland, what goals might the company set? What type of planning will be necessary?

Marginal benefit and the total cost of exercising : The optimal amount of exercise is determined by weighing the: a. marginal benefit and the total cost of exercising. b. marginal cost and the total benefit of exercising. c. marginal benefit and the marginal cost of exercisin

You are required to support your arguments : Write a paper arguing for or against the following statement: "Companies should not be held liable for losses sustained in a successful attack made on their AIS by outside sources." You are required to support your arguments.

Impacts materials handling and packaging discussions : Introduction: You are a consultant hired by a consumer products research company to analyze the packaging of various consumer products. Your first assignment is to go into a retail store and pick three products which consumers purchase on a freque..

Explain how a dbr system would work for zaramar : Determine the optimal mix and the maximum daily contribution margin (throughput). Explain how a DBR system would work for Zaramar.

Pareto efficiency or domination : For each statement give 2x2 matrix that shows it is false. (I'd start by looking at the games I put up in class, Prisoner's Dilemma, Battle of the Sexes, World's Dumbest Game, etc.) When I talk about Pareto efficiency or domination assume it's strong..

Prepare peg young response to stephen ruth : In 2010, Northern Airlines* merged with Southeast Airlines to create the fourth largest U.S. carrier. The new North-South Airline inherited both an aging fleet of Boeing 737-200 aircraft and Stephen Ruth. Ruth was a tough former secretary of the n..

Consider an idea that you have had for a new product : Consider an idea that you have had for a new product; a product that falls into that category of "Gee, I wish someone would develop_______." or ".I'll bet ______ would be a great product."

Investigate a transportation management system : Convoy Trucking just won a large bid with a new customer called H2Glow. The new customer is in the contaminated water business. To serve the newly acquired customer, Convoy Trucking is required to invest in new equipment and be compliant because t..

User Account

All Pages