An automobile company assembles cars in a plant and purchases batteries from a vendor in China. The
Question:
An automobile company assembles cars in a plant and purchases batteries from a vendor in China. The average cost of each battery is $45. The automobile company takes ownership of the batteries when they arrive at the plant. It takes exactly 12 hours to make a car in the plant, and the plant assembles 200 cars per 8-hour shift (currently, the plant operates one shift per day). Each car uses one battery. The company holds, on average, 8,000 batteries in raw material inventory at the plant as a buffer. Assignment: Find the total number of batteries in the plant on average (in work-in-process at the plant and in raw material inventory). How much are these batteries worth? How many days of supply are held in raw material inventory on average?
Step by Step Answer:
Operations And Supply Chain Management The Core
ISBN: 9781264098378
6th Edition
Authors: F. Robert Jacobs, Richard Chase