ISE 310L Fall 2015 GEZA BOTTLIK MIDTERM No. 1 10/08/2015 Revised Optimization deleted
DO YOUR WORK ON THIS HANDOUT. THIS WILL EXPEDITE THE GRADING OF THE PAPERS.
NAME ______
MIDTERM SCORE ______
Read these instructions!!
Please read the problems carefully and provide the information requested and only the information requested in each question. Use the minimum amount of work required to answer each question. Show all your work. The test is worth 6 points. (About 6% of your total grade).
Do your work on this handout – you should not need more space.
The test papers are to be handed in no later than 1:35 P.M. or one hour and 5 minutes after we start, whichever is later. It is unfair to your fellow students who hand in their papers on time to use more time than they had.
The test is open notes and open book. Use your calculator or laptop if needed.
If you want to ask a question, come up to me and ask me. In general it is better to make assumptions than to ask questions. If you want to borrow your neighbor’s calculator, ask me to do it for you. No talking to your neighbors.
Move on to the next problem if you are stuck.
Good luck, I hope you all do well.
Page 1 of 5 ISE 310L Fall 2015 GEZA BOTTLIK MIDTERM No. 1 10/08/2015 Revised Optimization deleted Problem No. 2 (or 4) continued on next page (2 points) Overall 73%
1. T F The major advantage of a distribution network with local storage is the decreased delivery cost to the final destination 54%
2. T F A company’s supply chain strategy specifies how the market will be segmented and how the product will be positioned, priced, and promoted 86%
3. T F Last mile delivery is defined as delivering from any source to any part of the supply chain 96%
4. To select a specific value from a distribution, you would use Excel’s ____Norminv______function 27%
5. T F If an optimization problem is non-linear and you try to solve it as a linear problem with Excel’s solver, it will tell you that it is non-linear 71%
6. T F A highly utilized facility will easily respond to demand fluctuations 86%
7. T F If an optimization problem is non-linear and you try to solve it as a linear problem with Excel’s solver, it will try and get a solution 89%
8. T F A washer/Dryer would usually be delivered by last mile delivery 63%
9. T F Facilities are an important driver of supply chain performance 100%
10. T F The objective of every supply chain is to maximize the overall value generated. 100%
11. T F Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chain’s efficiency and responsiveness 100%
12. T F The see the code behind an Excel spread sheet, you use the _Alt F11______key 48%
13. T F Landed cost refers to products that are shipped with trucks and trains 93%
14. T F Cycle inventory is inventory that is built up to counter predictable variability in demand 46%
15. T F Companies in the same industry often select very different distribution networks, because the choice of the distribution network can be used to achieve a variety of supply chain objectives ranging from low cost to high responsiveness 99%
Page 2 of 5 ISE 310L Fall 2015 GEZA BOTTLIK MIDTERM No. 1 10/08/2015 Revised Optimization deleted 16. T F Outbound transportation costs per unit tend to be lower than inbound costs, because inbound lot sizes are typically larger 86%
17. To select values from a table of numbers you would use Excel’s ___Lookup______function 67%
18. T F The Post Office is one potential agent to perform last mile delivery 79%
19. T F Best Performance of Product Variety is achieved with Manufacturer Storage and Direct Shipping 75%
20. T F Flow time and cycle time measure two different time periods 64%
Page 3 of 5 ISE 310L Fall 2015 GEZA BOTTLIK MIDTERM No. 1 10/08/2015 Revised Optimization deleted Problem No. 3 (or 1) You are the quality engineer for an importer of consumer goods, such as TVs and desk top computers. These goods come from overseas suppliers and are then sold in the U.S. Your job is to establish criteria with which to continuously monitor the performance of these suppliers. Describe the two criteria that you deem most important to you, why you have selected these criteria and the performance that you would find acceptable or unacceptable and why. (2 points) On time delivery and quality were mentioned most often. Everyone gave good reasons. Some of you failed to give concrete levels of acceptable performance. While I did not deduct for low performance numbers, O want you to realize that quality numbers need to be much better than just 99.9%.Imagine making 12,000 washers a day. At 99.9% you would have 12 faulty washers every day. Same with on time – a cargo ship delayed means millions of products late.
Page 4 of 5 ISE 310L Fall 2015 GEZA BOTTLIK MIDTERM No. 1 10/08/2015 Revised Optimization deleted
Problem No. 4 A manufacturing operation uses 200,000 standard or earned labor hours per year to produce a variety of products. The other significant numbers are - $20,000,000 of non-material indirect overhead, $2,000,000 of material overhead, $125,000,000 of purchased direct material, and direct labor cost of $27/hour. You know that one of these products has 0.25 hours of labor and $90 worth of material. Labor efficiency is 85%. We allocate indirect overhead to labor and material overhead to material. What is the cost of one unit of the indicated product? (2 points).
Loaded labor rate = (20000000+200000*27/.85)/200000 = 131.76 Loaded material rate = 1 + 2000000/125000000 = 1.016 Total cost = 131.76*.25 + 90*1.016 = $124.38
Problem No. 2 A manufacturing operation uses 300,000 standard or earned labor hours per year to produce a variety of products. The other significant numbers are - $30,000,000 of non-material indirect overhead, $4,000,000 of material overhead, $250,000,000 of purchased direct material, and direct labor cost of $28/hour. You know that one of these products has 0.2 hours of labor and $75 worth of material. Labor efficiency is 90%. We allocate indirect overhead to labor and material overhead to material. What is the cost of one unit of the indicated product? (2 points). Loaded labor rate = (30000000+300000*28/.90)/300000 = 131.11 Loaded material rate = 1 + 4000000/250000000 = 1.016 Total cost = 131.11*.2 + 75*1.016 = $102.42
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