Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Identifying and Exploiting Constraints, Constraint Elevation Confer Company produces two different metal components used in medical equipment (Component X and Component Y). The company has

image text in transcribed
image text in transcribed
Identifying and Exploiting Constraints, Constraint Elevation Confer Company produces two different metal components used in medical equipment (Component X and Component Y). The company has three processes: molding, grinding, and finishing. In molding, molds are created, and molten metal is poured into the shell. Grinding removes the gates that allowed the molten metal to flow into the mold's cavities. In finishing, rough edges caused by the grinders are removed by small, handheld pneumatic tools. In molding, the setup time is one hour. The other two processes have no setup time required. The demand for Component X is 540 units per day, and the demand for Component Y is 1,100 units per day. The minutes required per unit for each product are as follows: The company operates one eight-hour shift. The molding process employs 22 workers (who each work eight hours). Two hours of their time, however, are used for setups (assuming both products are produced). The grinding process has sufficient equipment and workers to provide 410 grinding hours per shift. The Finishing Department is labor intensive and employs 75 workers, who each work eight hours per day. The only significant unit-level variable costs are materials and power. For Component X, the variable cost per unit is $44, and for Component Y, it is $51. Selling prices for X and Y are $99 and $114, respectively. Confer's policy is to use two setups per day: an initial setup to produce all that is scheduled for Component X and a second setup (changeover) to produce all that is scheduled for Component Y. The amount scheduled does not necessarily correspond to each product's daily demand. 1. Calculate the time (in minutes) needed each day to meet the daily market demand for Component X and Component Y. What is the major internal constraint facing Confer Company? 2. Describe how Confer should exploit its major binding constraint. Specifically, identify the product mix that will maximize daily throughput. 3. Assume that manufacturing engineering has found a way to reduce the molding setup time from one hour to 10 minutes. How many units of Component X and Component Y would be produced

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting Tools For Business Decision Making

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso

4th Edition

0471730513, 978-0471730514

More Books

Students also viewed these Accounting questions