Rolls-Royce that produces engine for Boeing 787 Dreamliner at its London manufac
ID: 425421 • Letter: R
Question
Rolls-Royce that produces engine for Boeing 787 Dreamliner at its London manufacturing plant uses kanbans to support its production process of the engine shaft. Using the necessary data below, determine the size of the kanban for the engine shaft production and the number of kanbans needed. Setup cost Annual holding cost Daily production Annual usage S30 $220 per unit 360 units 20,000 units (50 weeksx5 days eachxdaily usage of 80 units) 5 days 0.50 days' production Lead time Safety stock Kanban (containe)sizeunits (round your response to the nearest whole number). Number of kanbans kanbans (round your response to the nearest whole number).Explanation / Answer
Following are the relevant details provided :
Annual demand for engine shaft = D = 20,000 units
Production set up cost = Cs = $30
Annual unit holding cost = Ch = $220
Daily production quantity = p = 360
Daily demand = d = 80
The economic production quantity ( EPQ ) which minimizes total inventory cost
= Square root ( 2 x Cs x D/ Ch x ( 1 – d/p))
= Square root ( 2 x 30 x 20,000 / 220 x ( 1 – 80/360))
= Square root ( 2 x 30 x 20,000 / 220 x 0.777)
= 83.78 ( 84 rounded to nearest whole number )
Therefore production order quantity which should be same as Kanban ( Container ) size = 84
Total number of engine shafts which should be there as work in process inventory in Kanban containers
= ( 5 days lead time + 0.5 days of production as safety stock) x Daily production rate
= 5.5 x 360
= 1980 engine shafts
Therefore number of Kanbans
= Number of engine shafts in Kanban containers/ Kanban container size
= 1980 / 84
= 23.57 ( 24 rounded to nearest whole number )
KANBAN CONTAINER SIZE = 84 UNITS
NUMBER OF KANBANS = 24 UNITS
KANBAN CONTAINER SIZE = 84 UNITS
NUMBER OF KANBANS = 24 UNITS
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.