A metal fabrication shop has a single punch press. There are three parts that the shop...

   

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A metal fabrication shop has a single punch press. There are three parts that the shop has contracts on to produce parts using the press. The yearly product information is: Part 1 2 3 Demand 3000 6000 2000 Setup Unit Cost Cost $100 $20 220 30 Prod. Rate 9000 18000 160 26 8000 Holding cost are based on 25% annual interest rate (of the unit cost). Machine setup times are negligible. (a) Without considering machine usage overlap, what is the optimal (round) order quantity by product and the total system cost? (b) What is the machine utilization (percent of the time that the punch press is busy)? (c) To keep product production overlaps from occurring, the company uses a common cycle for all products on the punch press. What is the optimal cycle time? (d) Using the common cycle time, what are the production quantities for each product and their costs? How much does using this common cycle time cost the company per year. A metal fabrication shop has a single punch press. There are three parts that the shop has contracts on to produce parts using the press. The yearly product information is: Part 1 2 3 Demand 3000 6000 2000 Setup Unit Cost Cost $100 $20 220 30 Prod. Rate 9000 18000 160 26 8000 Holding cost are based on 25% annual interest rate (of the unit cost). Machine setup times are negligible. (a) Without considering machine usage overlap, what is the optimal (round) order quantity by product and the total system cost? (b) What is the machine utilization (percent of the time that the punch press is busy)? (c) To keep product production overlaps from occurring, the company uses a common cycle for all products on the punch press. What is the optimal cycle time? (d) Using the common cycle time, what are the production quantities for each product and their costs? How much does using this common cycle time cost the company per year.

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