A company manufactures hair dryers. It buys some of the components, but it makes

Question

A company manufactures hair dryers. It buys some of the components, but it makes the heating element, which it can produce at the rate of 907 per day. Hair dryers are assembled daily, 250 days a year, at a rate of 340 per day. Because of the disparity between the production and usage rates, the heating elements are periodically produced in batches of 2,268 units. Approximately how many batches of heating elements are produced annually? (Round your answer to 2 decimal places.) Number of batches If production on a batch begins when there is no inventory of heating elements on hand, how much inventory will be on hand three days latest Number of inventory What is the average inventory of elements, assuming each production cycle begins when there are none on hand? (Do not round intermediate calculations. Round your answer to the nearest whole number.) Average inventory d. The same equipment that is used to make the heating elements could also be used to make a component for another of the firm's products. That job would require four days, including setup. Setup time for making a batch of the heating elements is a half day. Is there enough time to do this job between production of batches of heating elements? Yes No

Explanation / Answer

a) Annual demand for hair dryers = 250 days X 340

Annual demand for hair dryers = 85,000 units

Number of batches = 85,000 / 2268

Number of batches = 37.47 batches

b) Inventory on hand after 3 days = 907 X 3

Inventory on hand after 3 days = 2,721

c) Average inventory of elements = Monthly demand / Inventory turnover

Average inventory of elements = 85,000/12 / 37.47

Average inventory of elements = 189.04 units

d) The option is yes .

Expected time between orders = No of working days per year / Expected number of orders

Expected time between orders = 250 / 37.47

Expected time between orders = 6.67 days

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