Evaluate 10.2 Problem 3

Canine Kernels Company (CKC) manufactures two different types of dog chew toys (A and B, sold in 1,000-count boxes) that are manufactured and assembled on three different workstations (W, X, and Y) using a small-batch process (see Figure 7.9). Batch setup times are negligible. The flowchart denotes the path each product follows through the manufacturing process, and each product’s price, demand per week, and processing times per unit are indicated as well. Purchased parts and raw materials consumed during production are represented by inverted triangles. CKC can make and sell up to the limit of its demand per week; no penalties are incurred for not being able to meet all the demand. Each workstation is staffed by a worker who is dedicated to work on that workstation alone and is paid $6 per hour. Total labor costs per week are fixed. Variable overhead costs are $3,500/week. The plant operates one 8-hour shift per day, or 40 hours/ week. Which of the three workstations, W, X, or Y, has the highest aggregate workload, and thus serves as the bottle-neck for CKC?

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