1. **State the problem:** We need to calculate the value-added time, non-value-added time, total lead time, and value-added ratio for both the present and proposed production approaches. 2. **Given data:** - Batch size present: 50 units - Batch size proposed: 2 units - Process times per step: Step 1 = 6 min, Step 2 = 12 min, Step 3 = 9 min, Step 4 = 3 min - Move times present: 6 min between steps, 6 min to raw materials, 6 min to finished goods - Move times proposed: 1 min between steps and inventory locations 3. **Formulas:** - Value-added time = sum of processing times for all units - Non-value-added time = sum of move times - Total lead time = value-added time + non-value-added time - Value-added ratio = $\frac{\text{Value-added time}}{\text{Total lead time}} \times 100\%$ 4. **Calculate for present approach:** - Total processing time per batch = $6 + 12 + 9 + 3 = 30$ minutes per unit - For 50 units: $30 \times 50 = 1500$ minutes (value-added time) - Move times: 6 min (raw materials to step 1) + 3 moves between steps $\times$ 6 min each + 6 min (step 4 to finished goods) = $6 + 18 + 6 = 30$ minutes (non-value-added time) - Total lead time = $1500 + 30 = 1530$ minutes - Value-added ratio = $\frac{1500}{1530} \times 100 = 98.0\%$ 5. **Calculate for proposed approach:** - Processing time per unit remains 30 minutes - For 2 units: $30 \times 2 = 60$ minutes (value-added time) - Move times: 1 min (raw materials to step 1) + 3 moves $\times$ 1 min each + 1 min (step 4 to finished goods) = $1 + 3 + 1 = 5$ minutes (non-value-added time) - Total lead time = $60 + 5 = 65$ minutes - Value-added ratio = $\frac{60}{65} \times 100 = 92.3\%$ **Final answers:** - Present approach: Value-added time = 1500 min, Non-value-added time = 30 min, Total lead time = 1530 min, Value-added ratio = 98.0% - Proposed approach: Value-added time = 60 min, Non-value-added time = 5 min, Total lead time = 65 min, Value-added ratio = 92.3%