ME 482 - Manufacturing Systems
WIP inventory costs
Concerned with minimizing costs of processing materials before the final product can be released to the consumer.
Production consists of a series of operations
Time is consumed in each operation (and time is cost)
Time and costs are consumed between each operation (e.g., material handling with no value added)
WIP represents money expended for material and processing, still considered inventory because goods are not yet delivered to the customer!