Brandon's Computer Shop Has Hired a Consultant to Help Apply

question 43

Essay

Brandon's computer shop has hired a consultant to help apply operations management techniques to increase profits.Currently the shop sells most of its computers to a high-end customized online retailer and sales are steady at 250 per month.A single work cell produces the computers.To produce the computer,three operations are required.First the parts must be assembled,next software must be installed,and finally the computer must be safely packed and labeled for shipping.These operations take 2 hours,5 hours,and 1 hour respectively.If there are 6 available work hours each day and the shop operates 20 days per month find:
(a)the takt time,and
(b)the number of workers Brandon should hire.

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Definitions:

Prime Cost

The combined direct costs of raw materials and labor that are directly attributable to the production of a product.

Direct Labor Cost

The wages paid to workers directly involved in production or service delivery, constituting a major component of a product's cost.

Variable Production

Production costs that vary in total directly and proportionately with changes in the production level.

Fixed Production

Production levels set without regard to the varying levels of demand or activity, often resulting in constant output rates.