Answer the Following Questions Using the Information Below

question 81

Multiple Choice

Answer the following questions using the information below:
Henry Inc., a manufacturing firm, is able to produce 1,000 pairs of sneakers per hour, at maximum efficiency. There are three eight-hour shifts each day. Due to unavoidable operating interruptions, production averages 800 units per hour. The plant actually operates only 27 days per month. Based on the current budget, Henry estimates that it will be able to sell only 500,000 units due to the entry of a competitor with aggressive marketing capabilities. But the demand is unlikely to be affected in future and will be around 515,000. Assume the month has 30 days.
-What is the master-budget capacity utilization level for this budget period?

• A) 500,000 units
• B) 515,000 units
• C) 518,400 units
• D) 720,000 units

---

Definitions:

Transportation

The movement of goods, people, or animals from one location to another using various modes including air, rail, road, water, or pipeline.

Manufacturing Cycle Time

The total time required from the start of production to the completion of the final product.

Throughput

The rate at which a system or process produces goods, completes tasks, or achieves outcomes, often measured within a specific time frame.

Pull Time

is the timing or scheduling mechanism in production or supply chains that initiates the movement or production of goods in response to demand.