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Myself Case

Autor:   •  November 14, 2011  •  Essay  •  294 Words (2 Pages)  •  1,269 Views

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Label changeover cost was based on the average length of time that the bottling line was shut down to change from one label to another label of a same bottle size. This idle time was assumed to be 30 minutes, consisting of 20 minutes to reset the labeling machine and 10 minutes to restore the labeling machine to continuous error-free operation following the change in labels. Since the part-time bottling laborers remained idle during the label changeover, the cost of this 30 minutes of down-time was based on both the hourly wage rate of these five workers and the annual salaries of Bob and Eliot.

Order-processing cost equaled the yearly cost of two office workers who earned a combined annual salary of $18,000 divided by the total number of separate item-bottling runs per year. These two clerks worked full-time processing the customs duty forms, federal tax forms, state tax forms, and other paperwork required to support the bottling operation. Size changeover cost equaled the cost of resetting all machinery for a change in bottle size divided by the average number of different items of a given size processed between size changeovers. The cost of resetting all machines for a change in bottle size was based on the annual salaries of Bob and Eliot and the fact that it took these two men one full day to complete all the machinery adjustments required for a size changeover. In a typical year, Blanchard operated the bottling line for 77 days during the year. The bottling equipment was adjusted approximately 35 times during the year for a change in bottle size; however, an average of 10 different items of a given bottle size were processed between size changeovers, resulting in about 350 separate item-bottling runs during the year.

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