The Average Lead Time of a Unit of Product Through

question 10

Multiple Choice

The average lead time of a unit of product through a manufacturing station is 10 minutes.The average work-in-process inventory at this station has been 30 pieces.What is the production rate?

• A) 0.33 pieces per minute
• B) 0.83 pieces per minute
• C) 1.66 pieces per minute
• D) 3 pieces per minute

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Definitions:

Sales Volume

The quantity of goods or services sold by a company within a specific period, used to measure business performance.

High-Low Method

An accounting technique used to estimate fixed and variable costs based on the highest and lowest levels of activity or cost.

Variable Cost

A cost that changes in direct proportion to changes in the level of business activity or output.

Fixed Cost

A cost that does not vary with the level of production or sales, such as rent, property taxes, and salaries.