Calculate Lead Time Flint Fabricators Inc. machines metal parts for the automotive industry. Under the traditional manufacturing approach, the parts are machined through two processes: milling and finishing Parts are produced in batch sizes of 65 parts. A part requires 5 minutes in milling and 8 minutes in finishing. The move time between the two operations for a complete batch is 9 minutes Under the lean philosophy, the part is produced in a cell that includes both the milling and finishing operations. The operating time is unchanged; however, the batch size is reduced to 4 parts and the move time is eliminated. Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the traditional and lean manufacturing methods. If required, round percentages to one decimal place. Traditional Philosophy Lean Manufacturing Philosophy Value-added time min Non-value-added time min min Total lead time min Value-added ratio (as a percent) Lean Accounting Westgate Inc. uses a lean manufacturing strategy to manufacture DVR (digital video recorder) players. The company manufactures DVR players through a single product cell. The budgeted conversion cost for the year is $873,600 for 1,820 production hours. Each unit requires 12 minutes of cell process time. During March, 920 DVR players were manufactured in the cell. The materials cost per unit is $82. The following summary transactions took place during March: 1. Materials were purchased for March production. 2. Conversion costs were applied to production 3. 920 DVR players were assembled and placed in finished goods. 4.870 DVR players were sold for $315 per unit. a. Determine the budgeted cell conversion cost per hour. If required, round to the nearest dollar $ 480 per hour b. Determine the budgeted cell conversion cost per unit. If required, round to the nearest dollar $ 70.24 X per unit Feedback Check My Work a. Budgeted conversion cost production hours = Conversion cost per hour b. (Cell process time + 60 minutes) x Conversion rate from Req. (a) - Conversion cost per unit Learning Objective 2. c. Journalize the summary transactions (1)-(4) for March Raw and In Process Inventory 75,440 Accounts Payable Raw and In Process Inventory Conversion Costs T 64,584 x Finished Goods Inventory Raw and In Process Inventory Sale Accounts Receivable 274,050 Sales 294,050 4. Cost of Goods Sold 133,414 Finished Goods Inventory 113.414 X Feedback Check My Work C. (1) Increase Raw and In Process Inventory (debit) and increase Accounts Payable (credit) for per unit amount times 920 units. (2) Conversion rate per unit from Req. (b) x 920 units - Total Conversion Costs to debit to Raw and In Process Inventory and credit to Conversion Costs. (3) [Materials cost per unit + Conversion rate per unit from Req. (b)] x 920 units = Finished Goods Inventory (debit) and Raw and In Process Inventory (credit). (4) Debit Accounts Receivable and credit Sales for 870 units x $315. Debit Cost of Goods sold and credit Finished Goods Inventory for 870 units X (Materials cost per unit + Conversion rate per unit from Reg. (b)]
