Confidential

UNIVERSITI TUN HUSSEIN ONN MALAYSIA

Faculty of Mechanical & Manufacturing Engineering

BDA 40102- INDUSTRIAL ENGINEERING

TEST 1, Semester II, Session 2012/2013
Instructions: Answer all questions in this sheet. (Time: 1 hour only)
Q1

The owner of Zam Pizzas, Mr. Zaman, is contemplating adding a new line of
pizzas, which will require leasing new equipment for a monthly payment of
$7500. Variable costs would be $3.00 per pizza, and pizza would retail for
$9.00 each.
a) How many pizzas must be sold in order to break even?
(5 marks)
b) What would the profit (loss) be if 2000 pizzas are made and sold in a
month?
(5 marks)
c) How many pizzas must be sold to realize a profit of $5000?

Solution:
FC = $7500 , VC = $3 per piece , Rev = $9 per piece
(1 mark)

a) Q =
= 7500 / (9-3)
= 1250 pizzas/month

(2 mark)
(2 mark)

b) For Q = 2000 ,
P = Q (R V ) FC =
= 2000 ($9 - $3 ) - $7500
= $4500 (profit)

(1 mark)
(2 mark)
(2 mark)

c) P = $5000
Q=

= (5000+7500)/(9-3)
= 2084 pizzas

GOOD

LUCK

(1 mark)
(2 mark)
(2 mark)

(5 marks)

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Q2

Halim Consultant Sdn. Bhd. was conducted a work sampling studies for 6
consecutive days at a factory. A total of 60 observations were made during the
8 hour working period for each day. The data collected during the 6 day
studies is illustrated in Table 1. The factory is operating 6 working days per
week.
i)

Compute the standard time (min/unit) for the assembly process.

(8 marks)

ii)

At peak demand period, the factory is normally required to produce

4,700 units per week. If only 80% of the employee is willing to work
over time, compute the average overtime per day must be arranged in
order to meet the peak demand.
(7 marks)
Table 1: Work Sampling Studies Data

Item
Total input over 6 days studies
A process at fast speed
A process at moderate speed
A process at slow speed
Production is stopped due to no operator
Production is stopped due to no material
The company's allowable allowances
Rating

GOOD

LUCK

Data
3,500 unit
35% of observations
45% of observations
5% of observations
6% of observations
9% of observations
15%.
90%

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Answer Assignment: Work Measurement

i.

Compute the standard time (min/unit) for the assembly process.

(2 mark)
Productive = 35%+45%+5%= 85%=0.85

(1 mark)
(1 mark)

Standard time, ST
= 2880 min / 3500 unit x 0.85 x 0.90 x (1/ (1 0.15)
= 0.741 min/unit
(2 mark)
ii.

(2 mark)

At peak demand period, the factory is normally required to produce ,4700 units per
week. If only 80% of the employee is willing to work over time, compute the average
overtime per day must be arranged in order to meet the peak demand.

Weekly quantity produced by 100% employee = 4700units

Weekly quantity shortage

= 4700 3500 = 1200 unit / week

Daily quantity shortage

= 1200 unit/week / 6 days/week

= 200 units/day

(1 mark)
(2 mark)

Time required to produce 200 units/day;

200 units/day x 0.741 min/unit = 148.2 min/day = 2.47 hr/day

(2 mark)

Considering only 80% employee available for over timework, therefore overtime
hours for each operator per day ;
= 2.47 hr/day / 0.80 employee
= 3.088 hr /day employee,

GOOD

LUCK

(2 mark)