Transmissions are delivered to the fabrication line four at a time. It takes two

Question

Transmissions are delivered to the fabrication line four at a time. It takes two hour for transmissions to be delivered. Approximately five vehicles are produced each hour, and management has decided that 30 percent of expected demand should be maintained as safety stock. How many kanban card sets are needed? (Round up your answer to the nearest whole number.)

Transmissions are delivered to the fabrication line four at a time. It takes two hour for transmissions to be delivered. Approximately five vehicles are produced each hour, and management has decided that 30 percent of expected demand should be maintained as safety stock. How many kanban card sets are needed? (Round up your answer to the nearest whole number.)

Explanation / Answer

K = DL(1+S)/C

D = 5 vehicles every hour (average demand)

L = 2 hour (lead time)

S = 30 percent (safety stock)

C = 4 transmissions (container size)

K = 5*2*(1+0.5)/4 = 3.75 = 4

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