Ricric Corporation has provided the following data for one of its products:

-The manufacturing cycle efficiency for this operation is closest to which of the following?
A) 0.18.
B) 0.33.
C) 0.375.
D) 0.45.

Question

Ricric Corporation has provided the following data for one of its products:

-The manufacturing cycle efficiency for this operation is closest to which of the following?
A) 0.18. 
B) 0.33. 
C) 0.375. 
D) 0.45.

Quizplus · Accepted Answer

Manufacturing cycle efficiency (MCE) is defined as the ratio of value-added time to total cycle time.

Value-added time = (number of units produced) x (time per unit - setup time) 
= 10,000 x (0.2 - 0.05) 
= 1,500 hours

Total cycle time = (number of units produced) x (cycle time per unit) 
= 10,000 x 0.4 
= 4,000 hours

MCE = (value-added time) / (total cycle time) 
= 1,500 / 4,000 
= 0.375

Therefore, the manufacturing cycle efficiency for this operation is closest to C) 0.375.

Ricric Corporation Has Provided the Following Data for One of Its