=+16-33 KKK Manufacturing lead times, relevant revenues, relevant costs OBJECTIVES 2, 3 Guardian Ltd makes wire harnesses for the aircraft industry. Guardian Ltd is uncertain about when and how many customer orders will be received. The company makes harnesses only after receiving firm orders from its customers. Guardian Ltd has recently purchased a new machine to make two types of wire harnesses, one for Boeing aircraft (B7) and the other for Airbus Industries aircraft (A3). The annual capacity of the new machine is 6000 hours. The following information is available for next year:

Customer Annual average number of orders Manufacturing time required Selling price per order if average manufacturing lead time per order is Variable cost per order Inventory carrying cost per order per hour Less than 200 hours More than 200 hours B7 125 40 hours $15 000 $14 400 $10 000 $0.50 A3 10 50 hours 13 500 12 960 9 000 0.45 Required 1 Calculate the average manufacturing lead times per order if Guardian Ltd manufactures:

(a) only B7 and

(b) both B7 and A3.