Given the demand forecast, cost, and operating data shown below; evaluate the followingproduction plans.$100$110$12$18Manufacturing cost per unitSubcontracting cost per unitRegular hourly wage rateOvertime hourly wage rateRegular hours per day per workerLabor hours per unitLayoff cost per workerHiring cost per workerInventory holding cost per unit per monthInitial workforce8$500$400$2250MonthDemandWorking days22JanuaryFebruary11,00015,00019March32,0002121AprilМayJune25,00030,00014.500a) Produce to meet demand by varying the size of the workforce. Satisfy demand for part-timework with overtime. Find the total cost.Workers WorkersFiredHr Available/Workerdays×8 hr)(22x8)=176 | (44000/176)=250HoursWorkers NeededMonthDemandReq.HiredJan.11,00015,000(11000×4)=44,00060,000Feb.15239432,00025,000March128,000AprilMayJune30,00014.500127,500597485Hours RequiredRegular Hoursazailable44,00059,888127,84899,960119,85657.920509,472Total cost = Total regular hour cost + Overtime cost + production cost + Hiring cost + Firing costsOrertime Hours44,00060,000128,000112152100,00040120,00058,00014480528 b) Produce with a fixed workforce of 500. Subcontract excess demand. Find the total cost.500 workers available, total available hour in January is 176 * 500 = 88,0004 hours required to produce one item, Total production in January: 88,000/4 = 22,000 unitsMonthDemandHrs./WorkerInventoryWorker Hr500 * (Av hr)(176×500) = 8800076000ProductionSubcontracted11,00015,000(units)22,00019,000176Jan.Feb.March11,00015232,000168AprilMay25,00016830,00014,500127,5001768000June16055008,000Total cost = Total production cost + Inventory cost + Subcontract costsc) Produce with a fixed workforce of 400. Subcontract excess demand. Find the total cost.400 workers available, total available hour in January is 176 * 400 = 70,400MontbDemandHrs./WorkerWorker HrProductionInsentorySubcontracted400 * (Av hr)(176×400) = 70,400Jan.Feb.11,00017617,60015,2006,60015,000152March32,0001688,400АprlМayJune25,00016830,00017614,500160127.50014,900Total cost = Total production cost + Inventory cost + Subcontract costs

The calculations: Hours required = Demand×Labor hours per unit (In the sheet, Cell values of B need…

Answered: Given the demand forecast, cost, and…

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...

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Answer format: Number: Round to: 2 decimal places.
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