What is the value of the new oven assuming no cost of labor

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Reference no: EM132283307

Assume that Kristen and her roommate have 300 days left before they graduate. They sell two-dozen cookies for $7.85, the material costs are $1.20 per two-dozen and the packaging costs are $0.20 per two-dozen. Kristen is considering buying a second oven (just like the first one). She accepts orders for cookies in two dozens. (Assume every order is for two-dozen cookies.) If she gets the second oven, answer the following questions:

- What is the bottleneck operation?

- What are the cycle times and capacities for each operation?

- What is the throughput time for an order?

- What is the maximum number of cookies (in dozens) that can be made in one evening?

- What is the value of the new oven assuming no cost of labor?

HINT: When two ovens are used, the capacity of the baking activity doubles (which also means the cycle time of the baking activity is halved). Assume the shop runs four hours every day. Assume that there is ample demand, that is, more demand than can be met with available capacity even with two ovens.

Additional info:

Mixing Batter - 6 mins for any no. of cookies

Sponning batter - 2min/dozen

Baking - 6mins/dozen

Cooling - 5 mins (but here it will be considered as 0, because space is not a resource)

Packing - 2min/dozen

Payment - 1min/order

Reference no: EM132283307

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