Question

Indy Company has the following data for one of its manufacturing plants:

Maximum units produced in a quarter (3-month period): 250,000 units
Actual units produced in a quarter (3-month period): 204,000 units
Productive hours in one quarter: 25,000 hours
Actual cycle time: 7.35 minutes
Theoretical cycle time: 6 minutes
Required:
1. Calculate the amount of processing time and the amount of nonprocessing time. If required, round your answers to two decimal places.
Processing time minutes
Nonprocessing time minutes
2. Calculate the MCE. If required, round your answer to nearest whole number. %

Answer 1

The amount of processing time is 1,498,040 minutes and the amount of nonprocessing time is 713,960 minutes. The MCE is 99%.

Step-by-step explanation:

To calculate the amount of processing time, we need to find the total time taken to produce the actual units. The formula to calculate processing time is:

Processing time = Actual units produced * Actual cycle time

Using the given data, the amount of processing time is:

Processing time = 204,000 units * 7.35 minutes = 1,498,040 minutes

To calculate the amount of nonprocessing time, we subtract the processing time from the total time available:

Nonprocessing time = Total time available - Processing time

Using the given data, the amount of nonprocessing time is:

Nonprocessing time = 25,000 hours * 60 minutes - 1,498,040 minutes = 713,960 minutes

To calculate the MCE (Manufacturing Cycle Efficiency), we divide the processing time by the total time available and multiply by 100:

MCE = (Processing time / Total time available) * 100

Using the given data, the MCE is:

MCE = (1,498,040 minutes / (25,000 hours * 60 minutes)) * 100 = 99%

Answer 2

1. Processing time:

Processing time = Theoretical time

Processing time is there for 6 minutes

Non processing time = Actual cycle time - processing time

= 7.35 - 6

= 1.35 minutes

2. Manufacturing Cycle Efficiency (MCE):

= Processing time / Actual cycle time

= 6 / 7.35

= 81.6%