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    Cost Analysis: 1.material Handling MGC

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    Karl David
    1. The document analyzes cost savings from reducing material handling costs and setup times in the production of various power tiller components. Total annual savings from reduced material handling is estimated to be Rs. 7,04,900. 2. Reducing setup times by 20% allows production of an additional 16 tillers annually, yielding Rs. 6,40,000 in additional profit. 3. A 38.24% overall productivity improvement in material handling could increase annual tiller production by 786 units, earning Rs. 2,35,80,000.

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    Cost Analysis: 1.material Handling MGC

    Uploaded by

    Karl David
    48 views9 pages
    1. The document analyzes cost savings from reducing material handling costs and setup times in the production of various power tiller components. Total annual savings from reduced material handling is estimated to be Rs. 7,04,900. 2. Reducing setup times by 20% allows production of an additional 16 tillers annually, yielding Rs. 6,40,000 in additional profit. 3. A 38.24% overall productivity improvement in material handling could increase annual tiller production by 786 units, earning Rs. 2,35,80,000.

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    Cost Analysis

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    1. The document analyzes cost savings from reducing material handling costs and setup times in the production of various power tiller components. Total annual savings from reduced material handling is estimated to be Rs. 7,04,900. 2. Reducing setup times by 20% allows production of an additional 16 tillers annually, yielding Rs. 6,40,000 in additional profit. 3. A 38.24% overall productivity improvement in material handling could increase annual tiller production by 786 units, earning Rs. 2,35,80,000.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    48 views9 pages

    Cost Analysis: 1.material Handling MGC

    Uploaded by

    Karl David
    1. The document analyzes cost savings from reducing material handling costs and setup times in the production of various power tiller components. Total annual savings from reduced material handling is estimated to be Rs. 7,04,900. 2. Reducing setup times by 20% allows production of an additional 16 tillers annually, yielding Rs. 6,40,000 in additional profit. 3. A 38.24% overall productivity improvement in material handling could increase annual tiller production by 786 units, earning Rs. 2,35,80,000.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 9

    Cost analysis

    1.MATERIAL HANDLING MGC Cost of Production for 1 MGC Indirect labour cost Material Handling Cost

    = 3856. = 183. = 50% = 183x0.5 = 91.5 %Reduction in Mtrl Handling = 46.5% Saving in Mtrl Handling = 42.55 No. of pieces produced per Annum =10000. Total Savings In MGC per Annum(A) = 4,25,500.

    SDC
    Cost of Production for 1 SDC Indirect labour cost Material Handling Cost = 1457. = 57. = 40% = 57x0.4 = 22.8 %Reduction in Mtrl Handling = 51% Saving in Mtrl Handling = 11.63 No. of pieces produced per Annum =10000. Total Savings In SDC per Annum(B) =1,16,300.

    CMS
    Cost of Production for 1 CMS Indirect labour cost Material Handling Cost = 916. = 59. = 40% = 59x0.4 = 23.6 %Reduction in Mtrl Handling = 20.4% Saving in Mtrl Handling = 4.81 No. of pieces produced per Annum =10000. Total Savings In CMS per Annum(C) = 48,100.

    GLR
    Cost of Production for 1 GLR Indirect labour cost Material Handling Cost = 485. = 43. = 40% = 43x0.4 = 17.2 %Reduction in Mtrl Handling = 58.9% Saving in Mtrl Handling = 10.12 No. of pieces produced per Annum = 10000. Total Savings In GLR per Annum(D) = 1,01,200.

    FCM
    Cost of Production for 1 FCM Indirect labour cost Material Handling Cost %Reduction in Mtrl Handling Saving in Mtrl Handling No. of pieces produced per Annum Total Savings In MGC per Annum(E) TOTAL SAVINGS(A+B+C+D+E) = 350. = 24. = 40% = 24x0.4 = 9.6 = 14.4% = 1.38 =10000. = 13,800. = 7,04,900.

    2.Set Up Time Reduction


    MGC
    Total Set Up time (fixture) = 2900 min/lot* Set Up time per piece = 2.9 min Operation time for unit piece = 201.8 min % Reduction in Set Up time = 20% Total Reduction in Set Up time per annum = 2.9x10000x.2=5800min Increase in No. of Products = 5800/201.8=28.7=28 nos

    Similarly number of SDC=18 CMS=16 FCM=22 GLR=32 Minimum no. is selected from these, ie = 16 nos. So, 16 more power tillers can be produced / year. Profit per Tiller = 40000 Total Profit = 16x40000= 6,40,000. *Lot=1000 units

    3.PRODUCIVITY IMPROVEMENT
    MATERIAL HANDLING: % JOB IN THE PRODUCTION OF A POWER TILLER=20.554% OVERALL IMPROVEMENT IN MATERIAL HANDLING=38.24% IMPROVEMENT IN PRODUCTIVITY=20.554x38.24/100=7.86%
    INCREASE IN PRODUCTION=10000x7.86/100=786 Nos.

    Earning=786x30,000=2,35,80,000
    Overall TOTAL SAVINGS(A+B+C+D+E) = 7,04,900.

    EXPENSES
    BUILDING RELOCATING THE TOOL CRIB=13,290,23290 (INCLUDES BUILDING OF NEW TOOL CRIB &REMOVAL OF OLD ONE ) RELOCATING THE INSPECTION SECTION=2,850 ,5850 MACHINE REARRANGEMENT Direct cost: TYPE A:4x14000=56,000 Type B:26x9500=2,47,000 Type C:5x7500=36,500 Type D:2x5500=11,000 Total =3,50,500

    Indirect cost Loss of working hours=240(12 days) Loss in profit=20x12x3500=8,40,000 Salary (non working days)=7,20,000 Other expenses=3,50,000

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