Isaacson Dental Inc. is considering a new lean product cell. The present manufacturing approach produces a product

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Isaacson Dental Inc. is considering a new lean product cell. The present manufacturing approach produces a product in four separate steps. The production batch sizes are 50 units. The process time for each step is as follows:

Process Step 1 ............................................ 6 minutes
Process Step 2 ............................................12 minutes
Process Step 3 ........................................... 9 minutes
Process Step 4 ..........................................  3 minutes

The time required to move each batch between steps is 6 minutes. In addition, the time to move raw materials to Process Step 1 is also 6 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 6 minutes.
The new lean layout will allow the company to reduce the batch sizes from 50 units to 2 units. The time required to move each batch between steps and the inventory locations will be reduced to 1 minute. The processing time in each step will stay the same.
Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the 

(a) Present and 

(b) Proposed production approaches.

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Financial And Managerial Accounting

ISBN: 9780357714041

16th Edition

Authors: Carl S. Warren, Jefferson P. Jones, William Tayler

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