Allegro Industries Is Planning to Change Its Manufacturing Plant by Automating

question 27

Essay

Allegro Industries is planning to change its manufacturing plant by automating and installing a flexible manufacturing system.The company is also changing its performance measures as well as its operating procedures.In an effort to evaluate performance and determine where improvements can be made,management has gathered the following data relating to activities over the last four months:
Many of these measures are new and the president has asked you to interpret the results.Throughput is the time it takes to turn materials into a completed product.Delivery cycle time is the time between receiving an order and shipping the goods.
Required:
Using the performance measures given,do the following:
a.Identify the areas where the company seems to be improving.
b.Identify the areas where the company seems to be deteriorating.

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Definitions:

Broker Commission

A fee paid to a broker for executing a transaction or providing specialized services.

Temporary Investments

Investments in securities that are expected to be sold within a short period, typically within one year.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the operating cycle of the business, whichever is longer.

Cash Equivalents

Investments that are liquid and short-term, easily turned into a specific amount of cash, with their initial durations being three months or shorter.