Castner Corporation is considering implementation of a JIT inventory system. The

Question

Castner Corporation is considering implementation of a JIT inventory system. The company's industrial engineer recently conducted a study to determine the average number of days spent in each activity of the production process. The following table summarizes her findings:

Production Activity Number of Days
Inspecting materials 3
Storing materials 17
Moving materials into production 3
Setting up production equipment 2
Cutting materials 6
Bending materials 5
Assembling finished products 9
Painting finished products 5

c.
Calculate Castner's total cycle time?

d.
Determine Castner's manufacturing efficiency ratio. (Omit the "%" sign in your response.)

Explanation / Answer

c.Castner's total cycle time = 3+17+ 3+2+ 6+5+9+5 = 50 days d .Manufacturing efficiency ratio: Value-Added Time / Total Cycle Time Castner’s total cycle time was computed in part c above. Its value-added time is shown below: Value-Added Activity Days Cutting materials 6 Bending materials 5 Assembling finished products 9 Painting finished products 5 Total value-added time 25 days Given total value-added time of 25 days and a total cycle time of 50 days, Castner’s manufac-tur¬ing efficiency ratio must be 50%: 25 days/50 days = 50%

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