In: Accounting
Christmas Express makes wreaths in batch sizes of 15. The cutting & assembly process takes 2 minutes per wreath and the decorating process time is 15 minutes per wreath. It takes 5 minutes to move the wreaths from the cutting & assembly process to the decorating process.
Compute the value-added, non-value-added, and the total lead time of the wreath process.
Value-added lead time: |
||
Non-value-added lead time: |
||
Move time |
||
Within batch wait time |
||
Total lead time |
Compute the value-added ratio. Round to one decimal place.
%
Value-added lead time [2 + 15] | 17 |
Non-value-added lead time | |
Move time | 5 |
Within batch wait time [17 x (15 wreaths - 1 wreath)] | 238 |
Total lead time | 260 |
.
.
Calculation of value-added ratio | |
Value added lead time (a) | 17 |
Total lead time (b) | 260 |
value-added ratio [(a ÷ b) x 100] | 6.5% |