A setup was performed in the Chicago facility each time a modification to the dolls was made. For example, to switch from a batch of girl dolls to a batch of boy dolls, a setup was required. Additionally, each time a specialty-branded doll was produced, a separate setup was required to process the raw materials to the required specifications. As the cradles were assembled entirely by hand, there were no setups in the Springfield plant. 3. For each production run, people in the receiving and production-control departments of the Chicago plant ordered, processed, inspected, and moved each batch of raw materials. This work required the same amount of time regardless of the production run length. The Springfield plant received materials on a just-in-time basis and continuously inspected and moved these materials.
4. The work in the packaging and shipping areas of both plants had increased during the past couple of years as the company increased the number of customers it served. Each time products were packaged and shipped, about the same amount of work was required, regardless of the number of items in the shipment.
The team had collected the data shown in Exhibit 4 based on operations in March 2000 and felt that this month was typical of ongoing operations with the plant producing at practical capacity. The team decided that plant management and facilities-related costs should continue to be allocated to products in the same way they had been under the old system, as a percentage of production-run direct labor cost.
The team collected data on the standard Geoffrey doll, the specialty-branded doll #106, and thethe meeting, Parker would discuss this issue with Hausner and Morehouse. Additionally, Parker wanted to discuss two additional product lines.
G.G. Toys had decided to produce holiday reindeer dolls in the Chicago plant during July, August, and September. The Chicago plant expanded its production capacity (i.e., machines and leased space) and reserved the...
Please join StudyMode to read the full document