XYZ Cosmetics,Inc Compute Total Delivery Cycle Time for Each Week and Evaluate

question 52

Multiple Choice

XYZ Cosmetics,Inc.,has developed a set of nonfinancial measures to evaluate on-time product delivery performance for one of its best-selling cosmetics.The following data have been generated for the past four weeks: $\begin{array}{llll}& \text { Purchase } & \text { Production } & \\& \text { Order } & \text { Cycle } & \text { Delivery } \\\text { Week } & \text { Lead Time } & \text { Time } & \text { Time }\\1 & 2.4 \text { days } & 3.5 \text { days } & 4.0 \text { days } \\2 & 2.3 \text { days } & 3.4 \text { days } & 3.6 \text { days } \\3 & 2.4 \text { days } & 3.3 \text { days } & 3.4 \text { days } \\4 & 2.2 \text { days } & 3.1 \text { days } & 3.7 \text { days }\end{array}$

Compute total delivery cycle time for each week and evaluate the product delivery performance.Which area still needs management's attention?

• A) Purchase order lead time
• B) Production cycle time
• C) Delivery time
• D) None, all have improved over the past four weeks.

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Definitions:

Opportunity Cost

The value of the best alternative that is forgone in making any choice or decision.

Terms of Trade

The ratio between a country's export prices and its import prices, indicating the quantity of imports goods a country can purchase through the sale of its exports.

Supply and Demand

Fundamental economic model describing how prices vary as a result of a balance between product availability and consumers' purchasing desires.

Opportunity Cost

The financial loss associated with rejecting the subsequent preferable choice when deciding or selecting amongst various options.