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Plant Efficiency and Capacity

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6. If a plant was designed to produce 7,000 hammers per day but is limited to making 6,000 hammers per day because of time needed to change equipment between styles of hammers, what is the utilization? Format as xx.x% (include the % sign.)

7. For the past month, the hammer plant in the above problem, which has an effective capacity of 6,500, has made only 4,500 hammers per day because of material delay, employee absences, and other problems. What is the efficiency? Format as xx.x% (include the %).

8. If a plant has an effective capacity of 6,500 and an efficiency of 88%, what is the actual (planned) output? Format as xxxx.

9. A plant has an effective capacity of 900 units per day and produces 800 units per day with its product mix; what is its efficiency? Format as xx.x% (include the % sign.)

10. Material delays have routinely limited production of household sinks to 400 units per day. It the plant efficiency is 80%, what is the effective capacity? Format as xxx.

12. You are considering opening a copy service in the student union. You estimate your fixed cost at $15,000 and the variable cost of each copy sold at $.01. You expect the selling price to be $.05. What is your breakeven point in dollars? Format as $xx,xxx

13. For the same copy service as above with a fixed cost of $15,000 and the variable cost of each copy sold at $.01 and a selling price to be $.05. What is your breakeven point in units? Format as xxx,xxx (include the comma.)

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Solution Summary

Plant efficiency and capacity are investigated using percentages. The solution is detailed and well presented. The response received a rating of "5/5" from the student who originally posted the question.

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Problem #6
The utilization is 6000/7000 = 6/7 = 85.7%

Problem #7
The efficiency is 4500/6500 = 9/13 = 69.2%

Problem #8
The actual output is 6500 * 88% = ...

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