Prior to installing a JIT system, Grindstone 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 $432,000 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 performmaintenance. Maintenance costs for the three cells still totaled $432,000; however, these costs are now traceable to each cell.

Question

Prior to installing a JIT system, Grindstone 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 $432,000 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 performmaintenance. Maintenance costs for the three cells still totaled $432,000; however, these costs are now traceable to each cell.

Quizplus · Accepted Answer

The Answer of Prior to installing a JIT system, Grindstone 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 $432,000 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 performmaintenance. Maintenance costs for the three cells still totaled $432,000; however, these costs are now traceable to each cell.

Prior to Installing a JIT System, Grindstone Company Used Machine