Scribd
Upload
38 views2 pages

Assignment 3

The document contains production and operations management assignment questions. It includes numerical questions about inventory classification, utilization, efficiency, and economic order quantity. It also includes scenario based questions about managing retail store inventory, explaining EOQ, managing demand and capacity at a post office and hotel, balancing workstation times in a mobile production facility, and achieving profitability with a paper machine.

Uploaded by

Muhammad Ali Hamza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
38 views2 pages

Assignment 3

The document contains production and operations management assignment questions. It includes numerical questions about inventory classification, utilization, efficiency, and economic order quantity. It also includes scenario based questions about managing retail store inventory, explaining EOQ, managing demand and capacity at a post office and hotel, balancing workstation times in a mobile production facility, and achieving profitability with a paper machine.

Uploaded by

Muhammad Ali Hamza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 2

Production and Operations Management - Assignment 3

Part A: Numerical

Q.1) L. Houts Plastics is a large manufacturer of injection-moulded plastics in North Carolina. An


investigation of the company’s manufacturing facility in Charlotte yields the information presented in
the table below. How would the plant classify these items according to an ABC classification system?

L. Houts Plastics’ Charlotte Inventory Levels


Item Code # Average Inventory (Units) Value ($/Unit)
1289 400 3.75
2347 300 4.00
2349 120 2.5
2363 75 1.5
2394 60 1.75
2395 30 2.00
6782 20 1.15
7844 12 2.05
8210 8 1.80
8310 7 2.00
9111 6 3.00

Q.2)
a) Amy Xia’s plant was designed to produce 7,000 hammers per day but is limited to making 6,000
hammers per day because of the time needed to change equipment between styles of hammers.
What is the utilization?
b) For the past month, the plant in problem (a), which has an effective capacity of 6,500, has made
only 4,500 hammers per day because of material delay, employee absences, and other
problems. What is its efficiency?

Q.3) Markland Manufacturing intends to increase capacity by overcoming a bottleneck operation by


adding new equipment. Two vendors have presented proposals. The fixed costs for proposal A are
$50,000, and for proposal B, $70,000. The variable cost for A is $12.00, and for B, $10.00. The revenue
generated by each unit is $20.00.
a) What is the break-even point in units for proposal A?
b) What is the break-even point in units for proposal B?

Q.4) Abey Kuruvilla, of Parkside Plumbing, uses 1,200 of a certain spare part that costs $25 for each
order, with an annual holding cost of $24.
a) Calculate the total cost for order sizes of 25, 40, 50, 60, and 100.
b) Identify the economic order quantity and consider the implications for making an error in
calculating economic order quantity.

Part B: Scenario based questions.

Q.1) You’re working as a retail store manager, and you face the following scenarios:
a. There is an issue that whenever a customer places an order to buy a product, that product is
not available in the store. What is the issue here? How will you manage this situation? How
will you avoid it in the future?
b. How and when would you determine to place reorders?
c. How would you explain EOQ and its importance while training a new employee?

Q.2) How would you manage demand and capacity in the following:
a. You are a working at a post office.
b. You are working at a hotel.

Q.3) Imagine you work at a mobile production facility.


a. There are four workstations—A, B, C, and D. Individually these stations take 2, 4, 1, and 3
minutes respectively to make a mobile. In which station does the inventory pile up more
and why? As a manager, how would you cater to this issue?
b. A mobile manufacturer produces one mobile every minute, but it takes 15 hours to make
one mobile from start to finish. Why is that?

Q.4) A paper machine requires high capital investment, but the paper is produced at a low variable cost.
How would you achieve profitability as a production manager?

You might also like