Capacity requirements are computed by multiplying the number of units scheduled for production at a work center by the:
A) the unit resource requirements and then adding in the setup time.
B) the setup time and then subtracting the unit resource requirements.
C) the setup time and then adding in the unit resource requirements.
D) the unit resource requirements and then subtracting the setup time.

Question

Quizplus · Accepted Answer

Capacity requirements are calculated by multiplying the number of units scheduled for production by the unit resource requirements (which includes time per unit for labor and machine) and then adding the setup time required for the production run. This approach ensures that both the variable time per unit and the fixed time for setup are accounted for in determining total capacity needs.

Capacity Requirements Are Computed by Multiplying the Number of Units