There are three steps to making a leather bag: cutting, sewing, and packaging. A cutting station is
Question:
There are three steps to making a leather bag: cutting, sewing, and packaging. A cutting station is automatic and one worker can take care of the job. On average, the cutting machine cuts five layers of leathers in 3 minutes (this includes setup times). Each layer of leather makes parts for 1 bag. At 7:00 a.m., the machine starts cutting. The sewing station is a labor-intensive step - there are 8 workers. On average, it takes 12 minutes for one worker to sew one bag. However, sewing will not start until 10:00 a.m. For the packaging step there are two workers. Each worker can pack a bag in 1.5 minutes. Since this is the last step of the process, the worker won't start the work until 12:00 p.m. Each worker can only work a maximum of 8 hours in a day (there is only one shift at each step, ignore break times). The current demand for bags is 400 bags/day. They start the day with no inventory, and must finish the day's work with no remaining inventory.
What is the bottleneck for the current setup?
What is the factory capacity?
"Factory Capacity" means the maximum amount of the units the manufacturing units can produce during the specific period. The capacity may increase during the high demand for the products. The factory capacity can be calculated as daily plant capacity in hours divided by the time taken to produce a product.
Cornerstones of Cost Management
ISBN: 978-1111824402
2nd edition
Authors: Don R. Hansen, Maryanne M. Mowen