4. For each following activity, determine the amount of value-added and non-value-added costs.
a.The company keeps 7 days of materials inventory on hand to avoid shutdowns due to materials shortages. Carrying costs are $50,000 per day.
b. A time-and-motion study revealed that it should take 10 minutes to produce a product that now takes 50 minutes to produce. Labor is $18 per hour.
c. Warranty work costs the firm $500,000 per year. Warranty costs for the industry average $100,000 per year.
Days of Materials inventory		7	days
Carrying cost per a day		50,000	per a day
what it should take them to produce		10	Minutes
produce a product		50	Minutes
labor		18	per hour
Warranty cost the firm		500,000	per year
Industry average		100,000	per year