Question: Case 2. ( Make necessary assumptions and solve the following questions. Show all your works: including all computational procedures and details.) Sundance and his friend
Case 2. (Make necessary assumptions and solve the following questions. Show all your works: including all computational procedures and details.)
Sundance and his friend Butch are in the business of baking gourmet pizza. As soon as Sundance receives an order (either an Old West Pizza or a Sundance Kid Special Pizza) by phone, Sundance washes the bowl and mixes dough according to the customer's order. He then places the pizza dough onto a pan that holds one order of pizza. His friend Butch then sets the oven and places the pan in it. Pizza is baked in the oven and allowed to cool outside. Butch then wraps the pizza and collects payment from the customer. According to their observation, 10% of Sundance Kid Special Pizza produced are defective items and must be throw away (i.e., yield rate=100%-10%=90%; yield rate).
Assume that
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Old West Pizza price: $5.00/unit
Cost of material: $2.50/unit
Sundance Kid Special Pizza price: $7.00/unit
Cost of material: $1.00/unit
Old West Pizza maximum weekly demand : 80 units
Sundance Kid Special Pizza maximum weekly demand: 60 units
Scheduled availability in 1 week (Oven, Sundance, Butch= 1200minutes)
(Sundance Kid Special Pizza)
| # | Activities | Activity Time | Visit | Resources Allocated |
| 1 | Wash and Mix | 6 minutes | 1 | Sundance |
| 2 | Place | 3 minutes | 1 | Sundance |
| 3 | Load and Set | 3 minutes | 1.5 | Butch, Oven |
| 4 | Bake | 6 minutes | 2 | Oven |
| 5 | Unload and Cool | 2 minutes | 1 | Butch |
| 6 | Wrap | 5 minutes | 1 | Butch |
| 7 | Accept Payment | 2 minutes | 2 | Butch |
(Old West Pizza)
| # | Activities | Activity Time | Visit | Resources Allocated |
| 1 | Wash and Mix | 5 minutes | 1 | Sundance |
| 2 | Place | 3 minutes | 1 | Sundance |
| 3 | Load and Set | 1 minutes | 1.5 | Butch, Oven |
| 4 | Bake | 9 minutes | 1 | Oven |
| 5 | Unload and Cool | 1 minutes | 1 | Butch |
| 6 | Wrap | 3 minutes | 1 | Butch |
| 7 | Accept Payment | 2 minutes | 2 | Butch |
(c) Butch suggests that they can increases the yield rate of Sundance Kid Special Pizza from 90% to 95% by investing on the production process improvement program (PIP). To apply the PIP, the cost of PIP must not be higher than $X= ?.
Place Bake Wash & Mix Load & Set Wrap Unload & Cool Accept Paym't Sundance Butch Place Bake Wash & Mix Load & Set Wrap Unload & Cool Accept Paym't Sundance ButchStep by Step Solution
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