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Throughput

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Throughput

  • This topic has 3 replies, 3 voices, and was last updated 2 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • December 4, 2018 at 3:12 pm #487233
    scripts
    Member
    • Topics: 2
    • Replies: 1
    • ☆

    Glam Co is a hairdressing salon which provides both ‘cuts’ and ‘treatments’ to clients. All cuts and treatments at the salon are carried out by one of the salon’s three senior stylists. The salon also has two salon assistants and two junior stylists.
    Every customer attending the salon is first seen by a salon assistant, who washes their hair; next, by a senior stylist, who cuts or treats the hair depending on which service the customer wants; then finally, a junior stylist who dries their hair. The average length of time spent with each member of staff is as follows:
    Cut Treatment
    Hour Hours
    Assistant 0.1 0.3
    Senior stylist 1.0 1.5
    Junior Stylist 0.6 0.5
    The salon is open for eight hours each day for six days per week. It is only closed for two weeks each year. Staff salaries are $40,000 each year for each senior stylist, $28,000 each year for each junior stylist and $12,000 each year for each of the assistants. The cost of cleaning products applied when washing the hair is $1.50 per client. The cost of all additional products applied during a ‘treatment’ is $7.40 per client. Other salon costs (excluding labour and raw materials) amount to $106,400 each year.
    Glam Co charges $60 for each cut and $110 for each treatment.
    The senior stylists’ time has been correctly identified as the bottleneck activity.
    1.What is the annual capacity of the bottleneck activity?

    Please Sir Help

    December 5, 2018 at 6:28 am #487376
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54693
    • ☆☆☆☆☆

    The total hours the salon is open = 8 x 6 x 50 = 2,400 each year. The capacity for each senior stylist must therefore be 2,400 hours, which means 2,400 cuts each year (2,400/1). Since there are three senior stylists, the total capacity is 7,200 hours or 7,200 cuts each year. Using this method, the capacity for each activity is as follows:

    Assistants:
    Cuts: 2 (assistants) x 2,400/0.1 = 48,000
    Treatments: 2 x 2,400/0.3 = 16,000

    Senior stylists:
    Cuts: 3 (stylists) x 2,400/1 = 7,200
    Treatments: 3 x 2,400/1.5 = 4,800

    Junior stylists:
    Cuts: 2 (stylists) x 2,400/0.5 = 9,600
    Treatments: 2 x 2,400/0.55 = 9,600

    The bottleneck activity is the work performed by the senior stylists because the numbers they can deal with is less in each case than the assistants and the junior stylists

    September 9, 2022 at 2:19 pm #665948
    Toniababy
    Participant
    • Topics: 0
    • Replies: 1
    • ☆

    What is the throughput accounting ratio (TPAR) for both services? If the cost per hour is $42.56
    Cuts Treatments
    A 1·37 1·58
    B 1·41. 2·38
    C 1·37. 1·61
    D 1·41 2·41

    September 9, 2022 at 3:31 pm #665960
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54693
    • ☆☆☆☆☆

    I am puzzled why you are asking this, because you presumably have the answers (and workings) in the same book in which you found the question.

    The correct answer is A.

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