PLEASE ANSWER QUESTION D ONLY

3. Toledo Plastics has developed a product which incorporates new features with a standard product design. A production prototype has been built and the Methods Department has developed a job design for the production of the new product. Elemental times were taken from the Standard Data System and then checked with a stop-watch study. Toledo Plastics runs one 8 hour shift per day, 5 days a week and provides workers a 90 minute daily allowance for personal time and other contingencies. Daily standards are calculated as the normal time for the job divided by 1 -% Allowance. Production workers earn $25.00 per hour. Below is a summary of the methods Department's stop-watch study. Product #4356 Timed on 6-4-20 150 cycles timed all time in seconds Element Average Time (sec) Performance Rating 2 3 200 70 100 200* 70 80 1.20 1.00 .90 .85 1.25 .90 4 * Three cycles thrown out of calculation due to machine slippage. Average based on 147 cycles. B 2 A. Using the time study data collected, develop a standard time for this job. State the standard in parts per hour. (carry your answer out to two decimal places) ST=Tbar performance 1 Element Tbar(sec) Tbar(min) ST 2001 3.333333333 1.2 2.777778 3 2 70 1.166666667 11 1.166667 4 100 1.666666667 0.9 1.851852 5 4 200 3.333333333 0.85 3.921569 6 5 701 1.1666666671 1.25 0.933333 7 6 801 1.333333333 0.9 1.481481 8 total time wo allowance 12.13268 3 Total time = 12.13 minutes B. What is the current weekly nominal capacity for a production worker who works at 112% of standard with an average scrap rate of 2% Worker amt = 1 worker Hours= 8 hours day Days - 5 days week =8*60*5*1 minutes = 24.000 minutes week At no scrap we have 24,000 minutes / 12.13 minutes (standard time) = 1978.56 units week Scrap rate @ 2% 1978.56* 98 = 1938.98 @ 100 efficiency @112 efficiency = 1938.98 * 1.12 = 2171.65 units Nominal Capacity is 2171.65 units. C. Assuming there are 15 workers producing this product, what rate of efficiency must the workers average if they are to meet a weekly demand of 2,600 units given an average scrap rate is 5%? @ 2% scrap and 1.12 efficiency we have units of 1938.98 At a demand of 2600 units we have 2600/1938.98 or efficiency requirement of 1.34 100*1.34= 134% D. The Sales Department is about to sign a contract for 4000 units of product #4356. The customer is demanding a contract price of $80,000 for the units. If fixed costs (overhead) is assessed at 150% of the sum of direct labor cost and material cost per unit, and the direct material cost is $1.20 per unit, what is the profit contribution (or loss) to the company for accepting this contract