How many days does it take to produce optimal run quantity

Reference no: EM131765118

Wayne enterprises is about to begin the production of a new product. The manager of the department that produces one of the components wants to know how often the machine used to produce the item will be available for other work. The machine will produce the item at a rate of 300 units a day. Eighty units will be used daily in assembling the final product. Assembly will take place five days a week, 50 weeks a year. The manager estimates that it will take almost a full day to get the machine ready for a production run at a cost of $400. The inventory holding costs will be $15 a year. a.What run quantity should be used to minimize the total annual costs? b.How many days does it take to produce the optimal run quantity? c.What is the average amount of inventory (in units/day)? d. If themanager wants to run another job between runs of this item and needs a minimum of 10 days per cycle for the other work, will there be enough time? e.Given the answer to part d above, the manager wants to explore options that will allow the other job to be performed using this equipment. Name three options the manager could consider. f. Suppose the manager decides to increase the run size of the new product. How many additional units would be needed to just accommodate the other job? How much will that increase the total cost?

Reference no: EM131765118

Questions Cloud

What is the rationale for accounting : What is the rationale for accounting for nonexpendable endowment funds on a full, rather than a modified, accrual basis?

Explosion and conduct of managers of the mine : Describe the ethical categories involved in the explosion and conduct of the managers of the mine.

Discuss the relevance of each of the givem items : Lahore Cornpany has received a special order for photo equipment it does not normally produce. The company has excess capacity.

Explain paper on shakespeare and his contribution to drama : Prepare a powerpoint presentation which explains my paper on Shakespeare and his Contribution to Drama. Will upload paper to get material and references from.

How many days does it take to produce optimal run quantity : 10.Wayne enterprises is about to begin production of new product. How many days does it take to produce the optimal run quantity?

List five factors that affect statistical power : List five factors that affect statistical power. For each, indicate how a researcher can leverage/manipulate that factor to increase power in a study.

How is effective control achieved in a manufacturing concern : How does the cost accounting function assist in the management of the business? How is cost accounting information used by management?

Prepare a statement of cash flows : Problem - Preparation of a Statement of Cash Flows and a Balance Sheet. Cash dividends of $25,000 were declared and paid

Discuss operating expenses as a percentage of net sales : Which of the following types of financial statement analysis would be used to see how a company's operating expenses as a percentage of net sales

User Account

All Pages