100%(2)2 out of 2 people found this document helpful
This preview shows page 1 - 2 out of 2 pages.
Chad Boyle 7793411MacPherson Refrigeration Ltd. Case SummaryLinder Metzler, newly appointed production planning manager of MacPherson Refrigeration Ltd.(MRL) is in charge of formulating a production plan for next year. Next year, MRL expects to produce 480 appliances per worker. Current Aggregate Plan:1)Plant capacity: 13,000 appliances/month2)Next year, MRL’s 160 unionized workers will receive a $0.75 raise per hour (avg. wage is$10.50). With fringe benefits, cost is ~$2,400 per worker per month. Overtime cost is ~$3,300 per month (OT is 1.5x wage). The current plan calls for 160 workers.3)Estimated cost of hiring, training, etc. is $1,800 per worker. Estimated cost of severance/other layoff costs is $1,200 per worker. 4)To hold an appliance in inventory for a month has been calculated to cost roughly $8. Thecurrent plan predicted an inventory of 240 finished units.5)Plant was primarily a final assembly operation with a throughput time of about 3 days. They use a MRP based system and management assumes all worker hours contribute directly to output.