ITPEC FE Morning April 2023 Question 70

Topic: Corporate Activities

A product that is produced through four (4) processes of A, B, C, and D must be produced in a quantity of 1,000 units per month. The table below lists the manufacturing time per unit, number of machines owned, and monthly production capacity in hours per machine for each process. Which of the following is a process that is lacking in capability?

ProcessManufac­turing timeper unit (hours)Number of machinesowned (units)Monthlypro­duction capacity(hours/​machine)
A0.43150
B0.32160
C0.74170
D1.27180

Explanation

Process C — it provides 680 machine-hours a month but needs 700 hours to make 1,000 units.

Compare the hours each process needs for 1,000 units with the hours its machines provide in a month:

ProcessHours neededHours availableResult
A1,000 × 0.4 = 4003 × 150 = 450enough
B1,000 × 0.3 = 3002 × 160 = 320enough
C1,000 × 0.7 = 7004 × 170 = 68020 hours short
D1,000 × 1.2 = 1,2007 × 180 = 1,260enough

Put in units, process C can make at most 680 ÷ 0.7 ≈ 971 units a month.

Answer (c)

Why not others:

  • •(a) A — 450 hours available against 400 needed, room for 1,125 units
  • •(b) B — 320 hours against 300, room for about 1,066 units
  • •(d) D — it takes the longest per unit, 1.2 hours, but its 7 machines give 1,260 hours against 1,200 needed, room for 1,050 units

Key rule: A process's capacity is machines × hours per machine; compare it with the required output × time per unit rather than judging by the time per unit alone.

Corporate Activities · AI-written, may contain errors

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