SHOW FORMULAS IN EXCEL SPREADSHEET. SHOW FORMULAS IN EXCEL SPREADSHEET. SHOW FOR
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Question
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
14. Due to rapid changes in technology, a telecommunications manufacturer decides to produce a router, using JIT methods. Daily demand for the router is 17 units per day. The routers are built on racks that hold four at a time (i.e., the container size). Total processing and waiting time is 3.75 days. The process manager wants a safety factor of only 5 percent.
a. How many Kanbans are required?
b. What is the maximum authorized router inventory?
c. If you assume that one-half of the racks are empty and one-half are full at any given time, what is the average inventory of routers?
d. What are the new answers to (a) through (c) if, due to process improvements, the total processing and waiting time is reduced from 3.75 to 2.75 days?
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
SHOW FORMULAS IN EXCEL SPREADSHEET.
Explanation / Answer
Processing and waiting time = 3.75 days
Therefore, total requirement for in process inventory in form of Kanban = 17 x 3.75 =63.75
Since there is requirement of 5 percent of above in process inventory as safety stock, total safety stock = 0.05 x 63.75
Therefore, gross requirement including safety stock = 1.05 x 63.75 = 66.93 units
Given size of rack/ container = can hold 4 units
Therefore , Number of Kanbans required = 66.93/ 4 = 16.73 ( 17 rounded to nearest whole number )
Total requirement for in process inventory in form of Kanban = 17 x 2.75 = 46.75
Total safety stock = 0.05 x 46.75
Therefore , gross requirement including safety stock = 1.05 x 46.75 = 49.08 units
Size of container = 4 units
Therefore , number of Kanbans required = 49.08 /4 = 12.27 ( 13 rounding to next higher whole number )
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