Prior to Installing a JIT System, Plasticize Company Used Machine

question 65

Essay

Prior to installing a JIT system, Plasticize Company used machine hours to assign maintenance costs to its three products of 3-inch, 5-inch, and 7-inch plastic tubing.
The maintenance costs totaled $120,000 per year. The machine hours used by each product and the quantity produced of each product are as follows:
After installing JIT, three manufacturing cells were created and the cell workers were trained to perform maintenance. Maintenance costs for the three cells still totaled $120,000; however, these costs are now traceable to each cell.
Required:
a. Compute the maintenance cost per roll for each type of tubing before JIT is installed.
b. Compute the maintenance cost per roll for each type of tubing after JIT is installed.
c. Explain why the JIT maintenance cost per roll is more accurate than the cost per roll using the traditional approach.

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Definitions:

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An extinct species of human closely related to modern humans, living in Europe and parts of Asia until about 40,000 years ago.

Adaptive Evolution

Evolutionary changes that improve an organism's fit to its environment, driven by natural selection.

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Regions in the brain responsible for understanding and producing language, including Broca's and Wernicke's areas.

Existing Traits

Characteristics or attributes of organisms that are already present in a population due to evolutionary processes.