The Six Big Losses in Manufacturing

You should define equipment-related losses in such a way that provides sufficient information on what exactly failed. For example, rather than logging downtime as “production line”, we should be able to record which part of the production line experienced failure. Or, in social security tax rates the case of a single production machine or CNC machine, it is useful to know which part of the machine caused the failure. When products have to be discarded due to defects or reworked, the loss is not only that of quality and material, but also wasted production time.

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Defectives arise due to sub-standard materials, inadequate equipment, inefficient supervision, defective planning, and poor workmanship etc. (b) Abnormal defectives – They arise on account of abnormal circumstances and, therefore, should be taken to costing profit and loss account. It represents that portion of production which can be rectified and turned into good units by putting in extra material, labour and overheads. The Inspector prepares a Spoilage Report on finding that the work has been spoiled. The actual spoilage is compared with the standard or normal spoilage and remedial measures are taken for preventing any abnormal spoilage. Defectives represent that portion of production which can be rectified as a finished product by the help of more material, labour and overhead expenses.

Accounting of Material Losses

• Such scrap can be solid because it can be used by other industries by melting in furnaces.
• The maximum energy products of NdFeB PMs have the highest value, followed by alnico, samarium cobalt (SmCo), and ferrites; these can also be obtained from Fig.
• It should be noted that ‘scrap’ is always physically available while ‘waste’ may or may not be present in the form of a residue.

It should be noted that Mc is considered only for the worn area, Aw, (Mc × Aw/A0) in order to compare its value with Mw − c. Aw is the area of the wear track determined by optical or electronic microscopy after the tribocorrosion test. For passive materials, for example, Mc is negligible compared with Mw − c due to the destruction of the protective passive layer during wear which leads to a significant increase in material dissolution.

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However, when the applied field is increased up to point P2 the domain-wall movements are no longer reversible and the domains start to align themselves with the direction of the applied field. If the applied field keeps decreasing from point P2 the curve will go down to P2′ along the broken line creating a minor hysteresis curve and ending back at P2 again. As the applied field gets even stronger, the domain motion will cause essentially a total alignment of the microscopic moments with the applied field in the whole structure.

Performance Loss in Manufacturing

The second type is abnormal spoilage which takes place due to certain avoidable causes as explained while discussing abnormal wastage. Abnormal wastages occur when normal limits of wastage are crossed. It is transferred to Costing Profit and Loss account so as to avoid fluctuations in production costs. (iii) The value realised from sale of scrap is credited to the particular job, process or operation. The method has an advantage of identifying scarp with each operation, process or job. Abnormal defectives arises due to the abnormal factors, they are transferred to costing P/L A/C.

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There can be two types of wastage, namely normal wastage and abnormal wastage. From the sale proceeds of scrap selling and distribution costs are deducted and the net value is deducted from material cost or factory overhead. The effect of this method is to reduce material cost or overhead recovery rate.

This will reduce the material cost or factory overhead. However, this method fails to ensure effective control over scraps arising in processes or jobs. Abnormal wastage of material arising due to abnormal reasons, i.e. theft, fire, careless handling, etc., is not added to the cost of production but is transferred to costing profit and loss account.

At low frequencies, core loss is almost entirely hysteresis in ferrites, while on the other hand eddy current loss overtakes hysteresis loss in high frequency applications. For example, in metal alloy cores, eddy current loss dominates above a few hundred hertz. Some ferrites are ceramic-like compounds with very low conductivities. This is actually a required property for most applications especially at high frequencies since low conductivity limits the eddy current losses, such as in high frequency transformers. Rayleigh scattering arises due to random density fluctuations of frozen silica materials formed at the time of manufacturing. It is a well-known fact that loss due to Rayleigh scattering varies inversely as the fourth power of the propagating optical wavelength.

Materials having a very low turnover ratio are known as slow-moving items. However, materials that have no immediate demand are known as dormant materials. Obsolete items, on the other hand, are those for which there is no demand at all owing to the fact that the finished product, in which they are used, is no longer being produced.