Currently, in Littlefield, jobs arrive at 12 per day and you have (just) enough capacity at each station (i.e., the departure ra

Question

1 month ago

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Currently, in Littlefield, jobs arrive at 12 per day and you have (just) enough capacity at each station (i.e., the departure ra

te is also 12 per day). If you want to change to a contract that promises a throughput time of at most 0.25 days to reap the full profits, then what should you set your WIP Limit as

Mathematics

1 answer:

Svet_ta [12.7K] · Answer 1 · 2026-04-11T12:11:24+03:00

Response:

The Work In Progress (WIP) limit is set at 0.50 days.

Detailed explanation:

Calculating WIP limits:

first, it is essential to determine the efficiency of the process and procedure, which can be calculated as follows:

Value Added Time = 12 days (arrival time)

Non-Value-Added Time = 12 days (departure time)

Efficiency = Value Added / (Value Added + Non-Value Added)

= 12 / (12+12)

= 12 / 24

= 0.50 or 50%

the minimum required throughput time is 0.25 days to achieve the maximum profits

WIP limit = Throughput time / Efficiency

= 0.25 / 50%

= 0.50 days.

The WIP limit is 0.50 days.