Operations Management Homework Essay
1. A book publisher has fixed costs of $300000 and variable costs per book of $8. 00. The book sells for $23. 00 per copy. a. How many books must be sold to break even? Break-even demand = Total fixed cost / Unit price – Variable cost per unit = $300,000/ $23 – $8 = 20,000 b. If the fixed cost increased, would the new break-even point be higher or lower? From the formula given above: When fixed cost increased, the break-even point is higher. c. If the variable cost per unit decreased, would the new break –even point be higher or lower?
When variable cost per unit decreased, the break-even point is lower.
2. An assembly line is to operate eight hours per day with a desired output of 240 units per day. The following table contains information on this product’s task times and precedence relationship: Task| Task Time (s)| Immediate Predecessor | A| 60| -| B| 80| A| C| 20| A| D| 50| A| E| 90| B,C| F| 30| C,D| G| 30| E,F| H| 60| G| a. Draw the precedence diagram B B 80 E E 90 60A A C C H H G G F F 20 D D 30 60 30 50 b.
What is the work station cycle time?
C= Production time per period / Required output per period = 8 hr * 3600 s/hr / 240 units = 120 s/unit c. Balance this line using the longest task time Nt = T/C = 420s/unit / 120s/unit = 3. 5 = 4 Task Station| Task| Task time (s)| Remaining unassigned time (s)| 1| AD| 6050| 10| 2| BC| 8020| 20| 3| EF| 9030| 0| 4| GH| 3060| 30| d. What is the efficiency of your line balance? Efficiency = Sum of task times (T) / Actual number of work stations (Na) * C = (60+80+20+50+90+30+30+60)s / 4*120s/unit = 420/480 = 0. 875