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Process Actimty Analysis The trite Beverage Convipany botties soft driks into aluminum cans. The manufacturing process consists of three activities: 1. Mixing: watec, sugar, and
Process Actimty Analysis The trite Beverage Convipany botties soft driks into aluminum cans. The manufacturing process consists of three activities: 1. Mixing: watec, sugar, and beverage concentrate are mixed 2. Filling: mixed beverage is filled into 1202, cans 3. Packaging: properly filled cans are boved into cardboard "fridge pocks". The sctivity costs associated whth these activities for the period are as follows: The activey costs do not include materials costs, which are agnored lor this analysis. Poch can is expected to contain 12 ounces of beverage. Thus, after being filled, each can is automaticaly meighed. If a can is too light, it is rejected, of "kicked", from the filing line prior to being packaged. The primary cause of bocks as beat expansion. With beat expansion, the beverage dverflows during fitling, resulting in underwengbt cans This process begins by mixing and halling 12,480,000 cans during the period, of which only 12,000,000 cans are actually packaged 480,000 cans are rejected due to underweight wacks. A process irnprovement team fas deteiminod that cooling the cans prior to filling them will reduce the amount of overflows due to expansion, After this improvement, the number of kicks is expected to dedine from 480,000 cans to 120,000 cans, thus incteasing the number of filfed cans 1012,360,000(12,000,000+(480,000120,000)]. a. Determine the total activity cost per packaged can under present operations. Round to the nearest cent. per can b. Determine the amount of increased packaging activity costs from the expected improvements. Determine the expected total activity cost per packaged can after improvements. Round to three decimal places. per can
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