Please help me answer my SCM question Toc 5 worksheet A major snow shovel suppli
ID: 335432 • Letter: P
Question
Please help me answer my SCM question
Toc 5 worksheet A major snow shovel supplier manufactures two models of snow shovels: metal-bladed (MB) and plastic-bladed (PB). Production for both shovels happens at the same final assembly work center. The manufacturer has experienced an increase in demand because of harsh winter weather conditions, and is having difficulty filling orders on time. .Demand for MB shovels is 1500 per week. The material cost is $7, and each MB shovel is sold to retailers for $11 Demand for PB shovels is 1400 per week. The material cost is $5, and each PB shovel is sold to retailers for $8.5 The bottleneck has been identified as the Final Assembly workstation. Final Assembly has 11500 minutes of capacity per week. Each MB shovel requires 6 minutes at the bottleneck, while each PB shovel requires 4 minutes at the bottleneck. Operating expense is $8500 per week. Fill in the table below to determine the appropriate product mix to optimize profitability for this snow shovel manufacturer. Part a. Fill in the table below. Do not leave a cell blank; if the answer is zero, enter a O. Round all responses to 2 decimals, unless the answer is a whole numberExplanation / Answer
the calculations are as follows:
MB shovels
PB shovels
Retail price
11
8.5
Raw mat. Cost
7
5
Throughput per shovel
11-4 = 4
3.5
Minutes per unit
6
4
Throughput per minute at the bottleneck
4/6
= 0.67
0.88
Select the best product mix according to the throughput per minute of processing time at the bottleneck workstation Z. This method would take advantage of the principles outlined in the theory of constraints and get the most dollar benefit from the bottleneck.
Select the best product mix according to the highest throughput per minute of each product.
First produce, 1400 units of PB shovels with highest throughput per minute. Time remaining on final assembly 11500 minutes – (1400 x 4 minutes) = 5900 minutes.
In the remining time produce MB shovels. Units of MB shovels = 5900 minutes/6 minutes per unit = 983.33 units. Produce 983 units of MB shovels.
Total throughput for the build quantity = Optimal quantity x throughput per unit
MB shovels
PB shovels
Throughput per shovel
4
3.5
Optimal Quantity to build each week
983
1400
throughput for the build quantity
3932
4900
Total throughput = 3932 + 4900 = $8832
Weekly expenses = $8500
Profit = total throughput – weekly expenses = 8832 – 8500 = $332
Profit = #332
MB shovels
PB shovels
Retail price
11
8.5
Raw mat. Cost
7
5
Throughput per shovel
11-4 = 4
3.5
Minutes per unit
6
4
Throughput per minute at the bottleneck
4/6
= 0.67
0.88
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