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A production process consists of a three-step operation. The scrap rate is 10 pe

ID: 469485 • Letter: A

Question

A production process consists of a three-step operation. The scrap rate is 10 percent for the first step and 6 percent for the other two steps.


If the desired daily output is 450 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate calculations. Round up your final answer to the next whole number.)



If the scrap rate for each step could be cut in half at every operation, how many units would this save in terms of the scrap allowance? (Do not round intermediate calculations. Round up your final answer to the next whole number.)



If the scrap represents a cost of $10 per unit, how much is it costing the company per day for the original scrap rate (i.e. the Part a scrap rate)? (Round your answer to the nearest whole number. Omit the "$" sign in your response.)


a.

If the desired daily output is 450 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate calculations. Round up your final answer to the next whole number.)

Explanation / Answer

A production process consists of a three-step operation. The scrap rate is 10 percent for the first step and 6 percent for the other two steps.

a.

If the desired daily output is 450 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate calculations. Round up your final answer to the next whole number.)

step1

step2

step3

output

scrap rate

10%

6%

6%

Adding scrap %

556.182

505.62

477

450

  Number of units

556

units

b.

If the scrap rate for each step could be cut in half at every operation, how many units would this save in terms of the scrap allowance? (Do not round intermediate calculations. Round up your final answer to the next whole number.)

scrap rate

5%

3%

3%

Adding scrap %

501.27525

477.405

463.5

450

  Number of units needed

501

units

  Number of units saved

55

units

(556-501)

c.

If the scrap represents a cost of $10 per unit, how much is it costing the company per day for the original scrap rate (i.e. the Part a scrap rate)? (Round your answer to the nearest whole number. Omit the "$" sign in your response.)

Out of 556 units, the company is getting an output of 450 units daily.

hence, no. of scrap units =

106

units

scrap cost /unit =

10

  Cost

1062

A production process consists of a three-step operation. The scrap rate is 10 percent for the first step and 6 percent for the other two steps.

a.

If the desired daily output is 450 units, how many units must be started to allow for loss due to scrap? (Do not round intermediate calculations. Round up your final answer to the next whole number.)

step1

step2

step3

output

scrap rate

10%

6%

6%

Adding scrap %

556.182

505.62

477

450

  Number of units

556

units

b.

If the scrap rate for each step could be cut in half at every operation, how many units would this save in terms of the scrap allowance? (Do not round intermediate calculations. Round up your final answer to the next whole number.)

scrap rate

5%

3%

3%

Adding scrap %

501.27525

477.405

463.5

450

  Number of units needed

501

units

  Number of units saved

55

units

(556-501)

c.

If the scrap represents a cost of $10 per unit, how much is it costing the company per day for the original scrap rate (i.e. the Part a scrap rate)? (Round your answer to the nearest whole number. Omit the "$" sign in your response.)

Out of 556 units, the company is getting an output of 450 units daily.

hence, no. of scrap units =

106

units

scrap cost /unit =

10

  Cost

1062

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