Travel-Tow, Inc., is a producer of small utility trailers. The company partners with suppliers Obj. 5 to
Question:
Travel-Tow, Inc., is a producer of small utility trailers. The company partners with suppliers Obj. 5 to help reduce inventory carrying costs. Raw material deliveries are made every two hours. Materials are brought directly to the production line for immediate use. The following statistical process control chart captures variation in raw material delivery times.
a. Label the following elements on the control chart:
1. Upper control limit 2. Lower control limit 3. Process average
b. Is the process subject to common cause variation? Explain.
c. Is the process subject to special cause variation? Explain.
d. What might be an example of special cause variation in this manufacturing setting?
Step by Step Answer:
Managerial Accounting Information For Decisions
ISBN: 9780324222432
4th Edition
Authors: Thomas L. Albright , Robert W. Ingram, John S. Hill