You’re working with the Integrated Aircraft Systems (IAS) atBoeing and have been tasked to determine the hidden cost ofdefective parts, the DPMO and the current Sigma operating level ofIAS. You have collected the following data:- (round to wholenumber)
1- Daily Production 5500 parts (average price of each part$800.00 per part)
2- Current Yield 95%
3- Variable Costs $4,400,000 (variable costs includes cost ofany defective parts)
a. calculate the hidden cost of the defectiveparts
b. calculate the DPMO for the dailyproduction.
c. Determine the Sigma level of operation
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