Answer Happy

UAGM Parts & Accessories Inc, a manufacturing plant that
produces various automotive products, wants to implement a kanban
to pull material through its manufacturing work centers. Every work
center produces a specify family of products. One of the products
are rubber mats. The assembly of rubber mats involves cutting the
rubber using a mold. The rubber is pulled from warehouse into the
work center based on current demand. The rubber is purchased to an
external supplier. The supplier made and sells the rubber in
packages or lots of units of rubber not is separate units. Every
time you place an order of rubber, the supplier can respond to an
order for a lot of rubber in approximately 10 hours. The rubber mat
assembly production work center averages approximately 10
assemblies per hour. There is some variability in the process, so
the production manager has decided to have safety stock equivalent
to 8 percent of the needed inventory.
Cost per order
$ 10.00
Production rate/day
13
Demand rate/day
10
Total days per year
260
Holding cost/year
$ 90.13
Safety Factor
0.15