* QUESTION TWO Blue Inc. produces a product that has a 6 month demand cycle, as shown below. Each unit requires 10 worker hours to produce, at a labour cost of K6, 000 per hour regular rate or K9, 000 per hour overtime rate. The total cost per unit is estimated at K200, 000 but units can be subcontracted at a cost of K208, 000 per unit. There are currently 20 workers employed in the subject department, and hiring and training costs for additional workers are K300,000 per person; whereas layoff costs are K400,000 per person. Company policy is to retain a safety stock equal to 20% of the monthly forecast, and month's safety stock becomes the beginning inventory for the next month. There are currently 50 units in stock carried at a cost of K2, 000 per unit month. Unit shortage, or stockpots, has been assigned a cost of K20, 000 per unit month. January February March April June May Forecast demand 300 500 400 100 200 300 Work days 22 19 21 21 22 20 176 152 168 168 176 160 Work hour at 8 per day Develop an aggregate plan, maintaining a workforce of 20, and build inventory or incur stock out cost. The beginning inventory in January is 50.
* QUESTION TWO Blue Inc. produces a product that has a 6 month demand cycle, as shown below. Each unit requires 10 worker hours to produce, at a labour cost of K6, 000 per hour regular rate or K9, 000 per hour overtime rate. The total cost per unit is estimated at K200, 000 but units can be subcontracted at a cost of K208, 000 per unit. There are currently 20 workers employed in the subject department, and hiring and training costs for additional workers are K300,000 per person; whereas layoff costs are K400,000 per person. Company policy is to retain a safety stock equal to 20% of the monthly forecast, and month's safety stock becomes the beginning inventory for the next month. There are currently 50 units in stock carried at a cost of K2, 000 per unit month. Unit shortage, or stockpots, has been assigned a cost of K20, 000 per unit month. January February March April June May Forecast demand 300 500 400 100 200 300 Work days 22 19 21 21 22 20 176 152 168 168 176 160 Work hour at 8 per day Develop an aggregate plan, maintaining a workforce of 20, and build inventory or incur stock out cost. The beginning inventory in January is 50.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
Related questions
Question
![QUESTION TWO
*
Blue Inc. produces a product that has a 6 month demand cycle, as shown below.
Each unit requires 10 worker hours to produce, at a labour cost of K6, 000 per hour
regular rate or K9, 000 per hour overtime rate. The total cost per unit is estimated at
K200, 000 but units can be subcontracted at a cost of K208, 000 per unit. There are
currently 20 workers employed in the subject department, and hiring and training
costs for additional workers are K300,000 per person; whereas layoff costs are
K400,000 per person. Company policy is to retain a safety stock equal to 20% of the
monthly forecast, and month's safety stock becomes the beginning inventory for the
next month. There are currently 50 units in stock carried at a cost of K2, 000 per unit
month. Unit shortage, or stockpots, has been assigned a cost of K20, 000 per unit
month.
February March April
400
100
21
21
168
May
200
22
176
June
300
20
January
300
Forecast demand
500
Work days
22
19
176
152
168
160
Work hour at 8 per day
Develop an aggregate plan, maintaining a workforce of 20, and build inventory or
incur stock out cost. The beginning inventory in January is 50.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F31211817-c6fc-40e1-a7a5-5f5383d5e7ea%2F46f68a30-bf3c-4cdc-aee9-650433bfa8e1%2Frv3xs3_processed.jpeg&w=3840&q=75)
Transcribed Image Text:QUESTION TWO
*
Blue Inc. produces a product that has a 6 month demand cycle, as shown below.
Each unit requires 10 worker hours to produce, at a labour cost of K6, 000 per hour
regular rate or K9, 000 per hour overtime rate. The total cost per unit is estimated at
K200, 000 but units can be subcontracted at a cost of K208, 000 per unit. There are
currently 20 workers employed in the subject department, and hiring and training
costs for additional workers are K300,000 per person; whereas layoff costs are
K400,000 per person. Company policy is to retain a safety stock equal to 20% of the
monthly forecast, and month's safety stock becomes the beginning inventory for the
next month. There are currently 50 units in stock carried at a cost of K2, 000 per unit
month. Unit shortage, or stockpots, has been assigned a cost of K20, 000 per unit
month.
February March April
400
100
21
21
168
May
200
22
176
June
300
20
January
300
Forecast demand
500
Work days
22
19
176
152
168
160
Work hour at 8 per day
Develop an aggregate plan, maintaining a workforce of 20, and build inventory or
incur stock out cost. The beginning inventory in January is 50.
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