مبادئ حساب التكاليف الصناعية

ISE 304 Principles of Industrial Costing Exam 2 Sample

1. In the Saudi Factory for Buses, a certain assembly line has three stages. The sequence of stages and the standard time per unit in each stage are shown in the figure below:

   

   Workers in all stages operate 120 hours in a month. Workers in stage 1 are paid a salary of 4,000 riyals, workers in stages 2 and 3 paid 3,500 riyals. The industrial engineer is planning the assembly of 1,000 units. Calculate the associated total direct labor cost.

2. For a PC keyboard assembly process, the components and the number of the assembly parts for each keyboard are shown in the table below.

   Assembly parts	Number of parts per keyboard	Proportion of parts not usable or lost	Unit prices (riyals)
   Screws	5	1%	0.1
   Keys	1	2%	50
   Top cover	1	4.60%	7
   Bottom cover	1	4.90%	5

   
   

   Assembly parts (raw material) experience loss and damage due to poor material handling; and the percentage of lost or damaged parts is shown in the third column in the table. An order of 200 keyboards has been received. Estimate the associated direct material cost.

3. A worker is attending two machines; drilling machine and computer numerical control machine or CNC. These two machines are on two separate production lines that produce two different products. The worker-machine process chart is shown below.

   

   The worker’s wage is 12 riyals per hour. How can you allocate the direct labor cost on the two products?

4. An assembly line has two stages, where the standard time per unit on the first stage is 13 minutes and on the second stage it is 15 minutes. According to the company’s policy, the month consists of 100 hours. The production department has received an order of 300 products that have to be delivered in one month. The wage of regular workers is 13 riyals per hour. Overtime is permissible; however, the wage is double to 26 riyals per hour. Temporary workers can be hired; each individual temporary worker can contribute 10 hours. Temporary workers have to go through training before they can join the production department. Each temporary worker costs the company 150 riyals for his training. The wage of temporary workers is 8 riyals per hour. As an industrial engineer, which option, to ask for overtime or hire temporary workers, you recommend the production department to choose?
5. In a fan assembly line, sub-assembled components of a fan pass through 4 main workstations. The sequence of operations and the standard times in each workstation are as illustrated in the following figure:
   
   For each workstation, the standard time Ts is given. Workstation 3 does not always produce acceptable parts due to its old equipment and ill maintenance. The ratio of good parts to bad parts is 9:1.
   Assembly workers receive a salary of 4,500 riyals per month. The regular working hours of the plant are 6.5 hours per day from Saturday to Wednesday and 4 hours on Thursday. A month has four weeks.
   An order of 1,000 fans has been received by the production planning department. Calculate the total direct labor cost associated with this order.
6. A machining operation produces two parts in every run. The two parts are labeled part 1 and part 2. This operation is a joint operation because the parts are worked on at the same time. The standard time for each element of the operation is shown in the table below:
   

   Elements	Standard time (minutes)
   clean machine for parts 1 and 2	0.18
   load part 1	0.05
   Tighten fasteners for part 1	0.04
   load part 2	0.04
   start machine for parts 1 and 2	0.02
   stop machine for parts 1 and 2	0.03
   unload part 2	0.21
   Loosen fasteners for part 1	0.04
   unload part 1	0.25

   The machine is attended by one operator, whose wage is 12.5 riyals per hour. Compute the labor cost associated with part 2.

7. The Arabian Gulf Factory for Water Heaters and Desert Coolers in Khobar has received an order of 200 units of desert coolers. In planning the production, the industrial engineer has to plan for raw materials acquisition. The prices of raw materials in the Kingdom increase following the general inflation rate of 3% annually. The components of a desert cooler, the number of pieces of each component in a cooler, the unit prices, the percent defective, and the return-of-defective costs are:
   

   Component	Number of pieces in one cooler	Unit price from last year (riyals)	Percent defective or damaged in an order	Unit return cost from last year (riyals)
   Blower	1	350	2%	20
   Motor	1	520	0.10%	23
   Water pump	1	120	0.50%	19
   Evaporative pads	3	25	5%	4

   Calculate the raw materials cost associated with this order.

Instructor: Dr Muhammad Al-Salamah