A Production Line Is to Be Designed for a Product

question 254

Multiple Choice

A production line is to be designed for a product whose completion requires 21 minutes of work. The factory works 400 minutes per day. Can an assembly line with five workstations make 100 units per day?

• A) yes, with exactly 100 minutes to spare
• B) no, but four workstations would be sufficient
• C) no, it will fall short even with a perfectly balanced line
• D) yes, but the line's efficiency is very low
• E) cannot be determined from the information given

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Definitions:

Product Cost

Product cost encompasses all costs directly involved in manufacturing a product, including raw materials, labor, and manufacturing overhead.

Absorption Costing

A method of product costing that includes all manufacturing costs, both fixed and variable, in the cost of a product.

Total Product Cost

The complete cost of producing a product, including direct materials, direct labor, and both variable and fixed overhead.

Cost-Volume-Profit Analysis

An accounting technique used to determine how changes in costs and volume affect a company's operating income and net income.