Daily Usage of a Part Is 20 in a Facility

question 15

Essay

Daily usage of a part is 20 in a facility that operates 250 days of the year.Setup cost is $20 and annualized carrying cost is $210.Production of this part occurs at the rate of 50 per day when production of the part is underway.Lead time is 1 day;safety stock is 1/2 day's production.What is the optimum kanban size,and number of kanbans?

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Definitions:

Master Account

A primary account that is used to manage multiple sub-accounts under a single umbrella, often for purposes of consolidation and easier management.

Same Day Value

A banking term indicating that a fund transfer or transaction will be credited or debited with its value dated the same day the instruction is received.

Cash Concentration Account

A cash concentration account is a bank account used by companies to consolidate and manage their cash flows, usually involving the transfer of funds from multiple accounts into this single account.

Firm Benefits

Advantages or favorable factors resulting from the policies or practices of a particular company, including financial remuneration and non-monetary perks.