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# Numerical Problem (aggregate planning) Given the demand forecast, cost, and operating data shown below" Evaluate the following production plans.

Numerical Problem (aggregate planning)   Given the demand forecast, cost, and operating data shown below”  Evaluate the following production plans. Manufacturing cost per unit \$100 Subcontracting cost per unit \$110 Regular hourly wage rate \$12 Overtime hourly wage rate \$18 Regular hours per day per worker 8 Labor hours per unit 4 Layoff cost per worker \$500 Hiring cost per worker \$400 Inventory holding cost per unit per month \$2 Initial workforce                                                             250 Month Demand  Working days January 11,000 22 February 15,000 19 March 32,000 21 April 25,000 21 May 30,000 22 June 14,500 20 a) Produce to meet demand by varying the size of the workforce.  Satisfy demand for part- time work with overtime. Find the total cost. Month Demand Hours Req. Hr  Available  /Worker (days×8 hr) Workers Needed Workers Hired Workers Fired Jan. 11,000 (11000×4)=44,00 0 (22×8)=176 (44000/176)=250 Feb. 15,000 60,000 152 394 ? ? March 32,000 128,000 ? ? ? ? April 25,000 ? ? ? ? ? May 30,000 ? ? ? ? ? June   14,500 ? ? ? ? ? 127,500 597 485 Hours Required Regular Hours Overtime Hours 44,000 44,000 0 60,000 59,888 112 128,000 127,848 152 100,000 99,960 40 120,000 119,856 144
58,000 57,920 80 509,472 528 Total cost = Total regular hr cost +over time cost + production cost + hiring + firing costs b) Produce with a fixed workforce of 500. Subcontract excess demand. Find the total cost. Month Demand Hrs./Worker Production Inventory Subcontracted  Jan. 11,000 176 22,000 11,000 ? Feb. 15,000 152 19,000 ? ? March 32,000 168 ? ? ? April 25,000 168 ? ? ? May 30,000 176 ? ? 8000 June _14,500 160 ? 5500 0 127,500 ? 8,000 Total cost = Total production cost + Inventory cost + Subcontract costs c) Produce with a fixed workforce of 400.  Subcontract excess demand.  Find the total cost. Month Demand Hrs./Worker Production Inventory Subcontracted  Jan. 11,000 176 17,600 6,600 0 Feb. 15,000 152 15,200 ? 0 March 32,000 168 ? 0 8,400 April 25,000 168 ? 0 ? May 30,000 176 ? 0 ? June 14,500 160 ? ? 0 127,500 ? 14,900 ? Total cost = Total production cost + Inventory cost + Subcontract costs

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Numerical Problem (aggregate planning) Given the demand forecast, cost, and operating data shown below” Evaluate the following production plans.
Manufacturing cost per unit
Subcontracting cost...

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