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material planning in operation and supply chain management Lulwa WLL produces a component that is subsequently used in the aluminum industry. The component consists of
material planning in operation and supply chain management
Lulwa WLL produces a component that is subsequently used in the aluminum industry. The component consists of three parts (A, B, and C) that are purchased from outside and cost 0.50BD, 0.30BD, and 0.10BD per piece, respectively. Parts A and B are assembled first on assembly line 1, which produces 160 components per hour. Part C undergoes a mixing operation before being finally assembled with the output from assembly line 1. There are in total six mixing machines, but at present only four of them are operational Each mixing machine mixes part Cat a rate of 60 parts per hour. In the final assembly, the output from assembly line 1 is assembled with the mixed part C. The final assembly line produces at a rate of 170 components per hour. At present, components are produced eight hours a day and five days a week. Management believes that is need arises, it can add a second shift of eight| hours for the assembly lines. Other Costs: The cost of assembly labor is 0.31 BD per part for each assembly line; The cost of mixing labor is 0.15 BD per part. For mixing, the cost of electricity is 1 fills per part. The total overhead cost has been calculated as 1,250 BD per week. The depreciation cost for equipment has been calculated as 35 BD per week. a. Determine the process capacity (number of components produced per week) of the entire process. b. Suppose a second shift of eight hours is run for assembly line 1 and the same is done for the final assembly line. In addition, five of the six mixing machines are made operational. The mixing machines, however, operate for just eight hours a day. What is the new process capacity (number of components produced per week)? c. Management decides to run a second shift of eight hours for assembly line 1 plus a second shift of only three hours for the final assembly line. Five of the six mixing machines operate for eight hours a day. What is the new capacity? d. Determine the cost per unit output for questions b and c Step by Step Solution
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