. The following shx situations at Diviney Manufacturing Inc. are independent. Required: Estimate the nonvalue-added cost for...

 

  

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The following shx situations at Diviney Manufacturing Inc. are independent. Required: Estimate the nonvalue-added cost for each situation. a. A manual insertion process takes 30 minutes and 8 pounds of material to produce a product. Automating the insertion process requires 15 minutes of machine time and 7.5 pounds of material. The cost per labor hour is $12, the cost per machine hour is $8, and the cost per pound of materials is S10. 90 per unit b. With its original design, a gear requires 8 hours of setup time. By redesigning the gear so that the number of different grooves needed is reduced by 50%, the setup time is reduced by 75%. The cost per setup hour is $50. 300 per setup C. A product currently requires & moves. By redesigning the manufacturing layout, the number of moves can be reduced from 6 to 0. The cost per move is $20. 120 per unit d. Inspection time for a plant is 16,000 hours per year. The cost of inspection consists of salaries of 8 inspectors, totaling $320,000. Inspection also uses supplies costing $5 per inspection hour. The company eliminated most defective components by eliminating low-quality suppliers. The number of production errors was reduced deamatically by installing a svstem of statistical process control. Further quality improvements were realized by redesigning the products, making them easier to manufacture. The net effect was to achieve a close to zero-defect state and eliminate the need for any Inspection activity. 400.000 per yar The following shx situations at Diviney Manufacturing Inc. are independent. Required: Estimate the nonvalue-added cost for each situation. a. A manual insertion process takes 30 minutes and 8 pounds of material to produce a product. Automating the insertion process requires 15 minutes of machine time and 7.5 pounds of material. The cost per labor hour is $12, the cost per machine hour is $8, and the cost per pound of materials is S10. 90 per unit b. With its original design, a gear requires 8 hours of setup time. By redesigning the gear so that the number of different grooves needed is reduced by 50%, the setup time is reduced by 75%. The cost per setup hour is $50. 300 per setup C. A product currently requires & moves. By redesigning the manufacturing layout, the number of moves can be reduced from 6 to 0. The cost per move is $20. 120 per unit d. Inspection time for a plant is 16,000 hours per year. The cost of inspection consists of salaries of 8 inspectors, totaling $320,000. Inspection also uses supplies costing $5 per inspection hour. The company eliminated most defective components by eliminating low-quality suppliers. The number of production errors was reduced deamatically by installing a svstem of statistical process control. Further quality improvements were realized by redesigning the products, making them easier to manufacture. The net effect was to achieve a close to zero-defect state and eliminate the need for any Inspection activity. 400.000 per yar

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