Carmel Fisheries operates both a fleet of fishing boats and a cannery. All fish brought in by
Question:
Carmel Fisheries operates both a fleet of fishing boats and a cannery. All fish brought in by the company’s fleet are processed at its own cannery, and its cannery processes no other fish. If the fleet is operated at full capacity, then input to the cannery follows the annual pattern pictured below:
That is, full-time fishing yields 3600 tons per month during the first third of the year, 4800 tons per month during the middle third, and only 600 tons per month during the final third. The cannery operates at the same continuous throughput rate all year long. Fish that cannot be immediately processed in the cannery are placed in a freezer, where they are held for later processing. Fish that go unharvested due to lack of freezer space are assumed to be lost forever. (Hint: For this analysis, use the continuous process approximation that was discussed in this module.)
Now, suppose the buffer capacity of the freezer is 4800 tons, and the throughput capacity of the cannery is still 3000 tons per month.
(a) If the inflow rate of fish is the same as before, what throughput rate can be achieved (in tons/month)? (Hint: The answer is not 4800 tons/month.)
(b) What is the new average inventory level in the freezer?
(c) On average, how long will a fish wait in the freezer before being processed (in months)?
Accounting
ISBN: 978-1118608227
9th edition
Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett