Computador has a manufacturing plant in Des Moines that has the theoretical capability to produce 335,000 laptops per quarter but currently produces 100,500 units. The conversion cost per quarter is 10050000. There are 67,000 production hours available within the plant quarter. In addition to the processing time per unit used, the production of the laptops uses 10 minutes of move time, 30 minutes of wait time, and 20 minutes of rework time. (All work is done by cell workers)
Assume the company identifies poor plant layout as the root cause of wait time and move time.
Assume MCE target 80 percent
What is the expected conversion cost per unit?