A Company Can Produce a Part It Uses in an Assembly

question 54

Essay

A company can produce a part it uses in an assembly operation at the rate of 50 an hour. The company operates eight hours a day, 300 days a year. Daily usage of the part is 300 parts. The company uses the part every day. The run size is 6,000 parts. The annual holding cost is $2 per unit, and setup cost is $100.
(A) How many runs per year will there be?
(B) While production is occurring, how many parts per day are being added to inventory?
(C) Assuming that production begins when there are no parts on hand, what is the maximum number of parts in inventory?
(D) The machine is dedicated to this product. Every so often, preventive maintenance, which requires six working days, must be performed on it. Does this interrupt production cycles, or is there enough time between cycles to perform the maintenance? Explain.

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Definitions:

Cause-and-Effect Diagram

A visual tool that helps identify, sort, and display possible causes of a specific problem or quality characteristic.

Cafeteria Dissatisfaction

Reflects displeasure or unhappiness with the services, food quality, or overall experience of dining in a cafeteria setting.

Scatter Diagram

A graphical representation used to visualize the relationship between two quantitative variables, helping to identify any correlations.

Pareto Diagram

A graphical representation that identifies and prioritizes problems or causes of a particular event based on their significance, often used in quality control.