And now ladies and gentlemen, we have the lien accounting assignment just to finish the course off. Here is your briefing, log like right to make prefabricated log cabins for retail and commercial use. Increasing environmental awareness means that commercial business to business sales of log cabins are increasing and the commercial cabins sell for $5,995 each, compared to $3,995 for the retail cabins. However, the commercial cabins have a higher specification, which makes them harder to make. Both types of cabin are made in the same process, and the company's books calls for the last 12 weeks as shown on the next slide. And then we see the box score for 12 weeks with an average of the 12 weeks at the end and I'm not going to read these numbers to you.

I suggest that you pause the video and take some time Time to look at what's happening in this organization's process, in terms of the performance measures, the capacity and the financial performance. Question one, then study the book score, and identify three issues for local it right to address question to prepare an action plan for local write. Once you've answered those two questions, move on to part two of the Lean Accounting assessment. To address the manufacturing problems with the commercial cabins, the company is considering the purchase of a new cutting and forming machine. The machine would have a depreciation cost of $2,000 per week, and will allow the company to produce an extra 10 commercial units per week. Although there's only demand for six at present.

The machine will lift the right first time quality of the commercial units to 96% or higher and we'll reduce that Average end to end production time by two hours. On Time delivery for the commercial units would increase to 96% or better. With work in progress reduced by four days. Other costs are unaffected. And the task is to model an average week's box score to decide whether the company should purchase the machine. And when you've done part two, move on to part three of the Lean Accounting assignment.

If there were no additional commercial cabin sales available at present, would you advise the machine to be purchased. And finally, part four of the Lean Accounting assessment, which is about throughput accounting, prepare the throughput accounting metrics for the current state of the operation using annualized average figures and compare them for those with the proposed investment and utilize the weekly figures using 15 Few weeks. The only variable cost is the material cost. And assume that the level of investment is $1 million in the current state with the proposed new machine costing $500,000. Remember the throughput accounting measures there at the bottom and the four KPIs throughput accounting for you to use