A Machine Produces an Average of 500 Parts Per Day

question 5

Essay

A machine produces an average of 500 parts per day with a standard deviation of 10 parts. This is a normally distributed variable. The percent of defective parts ranges from 8-12%. Parts which need minor repair comprise 75% of the defective parts and cost $5 to repair. The rest of the defective parts cost $20 to repair. What formulas should go in cells B8:B15 to compute the daily cost of defective parts?
$\begin{array}{|c|l|c|c|c|c|c|} \hline& {\text { A }} & \text { B } & \text { C } & \text { D } & \text { E } & \text { F } \\\hline 1 & \text { Initial Conditions: } & & & & & \\\hline 2 & \text { Number of Parts: } & \text { Average } & 500 & \text { Std dev } & 10 & \text { Normal } \\\hline 3 & \% \text { Defective } & \text { Lo } & 8 \% & \text { Hi } & 12 \% & \text { Cont. Uniform } \\\hline 4 & \% \text { Minor Defects } & & 75 \% & & & \text { Constant } \\\hline 5 & \text { Cost of Minor Defect } & & \$ 5 & & & \text { Constant } \\\hline 6 & \text { Cost of Major Defect } & & \$ 20 & & & \text { Constant } \\\hline 7 & & & & & & \\\hline 8 & \text { Units Produced } & 500 & & & & \\\hline 9 & \% \text { Defective } & 8.2 \% & & & & \\\hline 10 & \text { Total \#Defective } & 41 & & & & \\\hline 11 & \text { \#With Minor Defects } & 31 & & & & \\\hline 12 & \text { Cost of Minor Defects } & \$ 155 & & & & \\\hline 13 & \text { \#With Major Defects } & 10 & & & & \\\hline 14 & \text { Cost of Major Defects } & \$ 200 & & & & \\\hline 15 & \text { Total Cost } & \$ 355 & & & & \\\hline\end{array}$

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