Christmas Express Makes Wreaths in Batch Sizes of 12

question 16

Essay

Christmas Express makes wreaths in batch sizes of 12.The cutting & assembly process takes 8 minutes per wreath and the decorating process time is 10 minutes per wreath.It takes 12 minutes to move the wreaths from the cutting & assembly process to the decorating process.
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(a)Compute the value-added,non-value-added,and the total lead time of the wreath process.
(b)Compute the value-added ratio.Round to the nearest decimal.

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Definitions:

Total Revenue

The overall amount of money generated by a firm from its sales activities before any costs or expenses are deducted.

Unit Price

The cost per unit of quantity of a product, which allows for easy comparison of cost efficiency between different products or services.

Demand Elastic

Refers to how sensitive the quantity demanded of a good is to a change in its price.

Demand Schedule

A chart displaying the amount of a product or service buyers are prepared and capable of buying at different price levels.