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K The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: May 2,100 1,400 1,700 June 2,100 January February March April 1,700 July 1,800 August Her operations manager is considering a new plan, which begins in January with 200 units on hand and ends with zero inventory. Stockout cost of lost sales is $125 per unit. Inventory holding com $20 per unit per month. Ignore any idle-time costs. The plan is called plan B. Plan B: Produce at a constant rate of 1,400 units per month, which will meet minimum demands. Then use subcontracting, with additional units at a premium price of $75 per unit. Subcontracting capacity is limited to 700 units per month. Evaluate this plan by computing the costs for January through August. In order to arrive at the costs, first compute the ending inventory and subcontracting units for each month by filling in the table below (enter your responses as whole numbers). 0 Period Month Demand Production December January February March April May June July August 0 1 2 3 4 5 6 7 8 1,700 1,400 1,400 1,700 1,700 1,800 2,100 2,100 1,700 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 Ending Inventory 200 Subcontract Units

K The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: May 2,100 1,400 1,700 June 2,100 January February March April 1,700 July 1,800 August Her operations manager is considering a new plan, which begins in January with 200 units on hand and ends with zero inventory. Stockout cost of lost sales is $125 per unit. Inventory holding com $20 per unit per month. Ignore any idle-time costs. The plan is called plan B. Plan B: Produce at a constant rate of 1,400 units per month, which will meet minimum demands. Then use subcontracting, with additional units at a premium price of $75 per unit. Subcontracting capacity is limited to 700 units per month. Evaluate this plan by computing the costs for January through August. In order to arrive at the costs, first compute the ending inventory and subcontracting units for each month by filling in the table below (enter your responses as whole numbers). 0 Period Month Demand Production December January February March April May June July August 0 1 2 3 4 5 6 7 8 1,700 1,400 1,400 1,700 1,700 1,800 2,100 2,100 1,700 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 Ending Inventory 200 Subcontract Units

Practical Management Science
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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K chis 2 A F1 N The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: January May 2,100 June 2,100 February March July 1,700 April August 1,400 Her operations manager is considering a new plan, which begins in January with 200 units on hand and ends with zero inventory. Stockout cost of lost sales is $125 per unit. Inventory holding cost is $20 per unit per month. Ignore any idle-time costs. The plan is called plan B. Plan B: Produce at a constant rate of 1,400 units per month, which will meet minimum demands. Then use subcontracting, with additional units at a premium price of $75 per unit. Subcontracting capacity is limited to 700 units per month. Evaluate this plan by computing the costs for January through August. Calculator Ask my instructor In order to arrive at the costs, first compute the ending inventory and subcontracting units for each month by filling in the table below (enter your responses as whole numbers). 0 @ 2 W S F2 X H command #m 3 E 30 F3 D $ 4 C 900 888 F4 R F de L % 5 V 20 FS T G 0 Period Month Demand Production December January February March April May 6 June 7 July 8 August 1 2 3 4 5 6 B 1,400 1,700 1,700 1,800 MacBook Pro M F6 Y H & 7 1,400 1.700 1,700 1,800 2,100 2,100 1,700 1,400 N 999 F7 U J 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 * 8 DII - M Ending Inventory 200 M K M F M 3 P B S 8 M ( 9 DD F9 < O I H Subcontract Units ) .c 0 L command 4 F10 P ^•. 2 : ; Clear all C F11 option { [ ? + 11 = =.. 1 Check answer F12 ◄ } ] delete ▼ 1 return shi
Transcribed Image Text:K chis 2 A F1 N The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: January May 2,100 June 2,100 February March July 1,700 April August 1,400 Her operations manager is considering a new plan, which begins in January with 200 units on hand and ends with zero inventory. Stockout cost of lost sales is $125 per unit. Inventory holding cost is $20 per unit per month. Ignore any idle-time costs. The plan is called plan B. Plan B: Produce at a constant rate of 1,400 units per month, which will meet minimum demands. Then use subcontracting, with additional units at a premium price of $75 per unit. Subcontracting capacity is limited to 700 units per month. Evaluate this plan by computing the costs for January through August. Calculator Ask my instructor In order to arrive at the costs, first compute the ending inventory and subcontracting units for each month by filling in the table below (enter your responses as whole numbers). 0 @ 2 W S F2 X H command #m 3 E 30 F3 D $ 4 C 900 888 F4 R F de L % 5 V 20 FS T G 0 Period Month Demand Production December January February March April May 6 June 7 July 8 August 1 2 3 4 5 6 B 1,400 1,700 1,700 1,800 MacBook Pro M F6 Y H & 7 1,400 1.700 1,700 1,800 2,100 2,100 1,700 1,400 N 999 F7 U J 1,400 1,400 1,400 1,400 1,400 1,400 1,400 1,400 * 8 DII - M Ending Inventory 200 M K M F M 3 P B S 8 M ( 9 DD F9 < O I H Subcontract Units ) .c 0 L command 4 F10 P ^•. 2 : ; Clear all C F11 option { [ ? + 11 = =.. 1 Check answer F12 ◄ } ] delete ▼ 1 return shi
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