16) To implement JIT, the manager at Seaton Hammock Manufacturing must incur $110,000 in annual production costs to reduce setup times. The manager expects JIT to reduce average inventory by $450,000...

16) To implement JIT, the manager at Seaton Hammock Manufacturing must incur $110,000 in annual production costs to reduce setup times. The manager expects JIT to reduce average inventory by $450,000 and relevant costs of insurance, storage, materials handling, and setup by $35,000 each year. The required rate of return on inventory investments is 10% per year. The manager was thinking about enhancing the quality of rework and warranty repair costs. What are the savings? Does the manager have enough information to implement the system?