Prior to installing a JIT system, Clark Company used machine hours to assign maintenance costs to its three products of 4-inch, 6-inch, and 9-inch insulation.The maintenance costs totaled $400,000 per year.The machine hours used by each product and the quantity produced of each product are as follows: After installing JIT, three manufacturing cells were created and the cell workers were trained to perform maintenance.Maintenance costs for the three cells still totaled $400,000; however, these costs are now traceable to each cell.

- The maintenance cost per roll of 6-inch insulation before JIT is installed would be

Question

Prior to installing a JIT system, Clark Company used machine hours to assign maintenance costs to its three products of 4-inch, 6-inch, and 9-inch insulation.The maintenance costs totaled $400,000 per year.The machine hours used by each product and the quantity produced of each product are as follows:

After installing JIT, three manufacturing cells were created and the cell workers were trained to perform maintenance.Maintenance costs for the three cells still totaled $400,000; however, these costs are now traceable to each cell.

- The maintenance cost per roll of 6-inch insulation before JIT is installed would be

Quizplus · Accepted Answer

The maintenance cost per roll of 6-inch insulation before JIT is installed is $6.40. This is because the maintenance cost is 10% of the total cost of the insulation, and the total cost of the insulation is $64.00.

Prior to Installing a JIT System, Clark Company Used Machine