Jennings Assembly in Hartford,Connecticut,uses a Component Supplied by a Company

question 118

Multiple Choice

Jennings Assembly in Hartford,Connecticut,uses a component supplied by a company in Brazil.The component is expensive to carry in inventory and consequently is not always available in stock when requested.Furthermore,shipping schedules are such that the lead time for transportation of the component is not a constant.Using historical records,the manufacturing firm has developed the following probability distribution for the product's lead time.The distribution is shown here,where the random variable is the number of days between the placement of the replenishment order and the receipt of the item. What is the coefficient of variation for delivery lead time?

• A)38.461%
• B)27.065%
• C)27.891%
• D)31.772%

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Definitions:

Direct Labor Hours

The total hours worked by employees directly involved in the manufacturing process.

Payroll

The total amount of wages, salaries, and other earnings paid by a business to its employees.

Labor Efficiency

The measure of the amount of work accomplished with a specific amount of labor input.

Labor Quantity Variance

The difference between the actual labor hours worked and the standard hours expected, multiplied by the standard labor rate.