Leather-All produces a line of handmade leather products. At the present time, the company is producing only belts, handbags, and attache cases. The predicted demand for these three types of items over a six-month planning horizon is as follows: Month No. of Belts Handbags Attache Cases Working days 1 22 2500 1250 240 2 20 2800 680 380 3 19 2000 1625 110 4 24 3400 745 75 5 21 3000 835 126 6 17 1600 375 45 The belts require an average of two hours to produce, the handbags three hours, and the attache cases six hours; all the workers have the skill to work on any item. Leather-All has 46 employees who each have a share in the firm and cannot be fired. There are an additional 30 locals that are available and can be hired for short periods at a higher cost. Regular employees earn $8.50 per hour on regular time, and $14.00 per hour on overtime. Regular time comprises a seven-hour workday and the regular employees will work as much overtime as is available. The additional workers are hired for $11.00 per hour and are kept on the payroll for at least one full month. Costs of hiring and firing are negligible. Because of the competitive nature of the industry, Leather-All does not want to incur any demand backorders. (a) Using worker hours as an aggregate measure of production, convert the forecasted demand to demand in terms of aggregate units. (b) What would be the size of the workforce needed to satisfy the demand for the coming six months on regular time only? Would it be to the company’s advantage to bring the permanent workforce up to this level? Why or why not? (c) Determine a production plan that meets the demand using only regular time employees and the total cost of that plan. (d) Determine a production plan that utilizes only additional employees to absorb excess demand and the cost of that plan. (e) Formulate the problem of optimizing Leather-All’s hiring schedule as a linear program. Define all variables and include the necessary constraints
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Leather-All produces a line of handmade leather products. At the present time, the company is producing only belts, handbags, and attache cases. The predicted demand for these three types of items over a six-month planning horizon is as follows:
Month No. of Belts Handbags Attache Cases
Working days
1 22 2500 1250 240
2 20 2800 680 380
3 19 2000 1625 110
4 24 3400 745 75
5 21 3000 835 126
6 17 1600 375 45
The belts require an average of two hours to produce, the handbags three hours, and the attache cases six hours; all the workers have the skill to work on any item. Leather-All has 46 employees who each have a share in the firm and cannot be fired. There are an additional 30 locals that are available and can be hired for short periods at a higher cost. Regular employees earn $8.50 per hour on regular time, and $14.00 per hour on overtime. Regular time comprises a seven-hour workday and the regular employees will work as much overtime as is available. The additional workers are hired for $11.00 per hour and are kept on the payroll for at least one full month. Costs of hiring and firing are negligible. Because of the competitive nature of the industry, Leather-All does not want to incur any demand
backorders.
(a) Using worker hours as an aggregate measure of production, convert the
(b) What would be the size of the workforce needed to satisfy the demand for the coming six months on regular time only? Would it be to the company’s advantage to bring the permanent workforce up to this level? Why or why not?
(c) Determine a production plan that meets the demand using only regular time employees and the total cost of that plan.
(d) Determine a production plan that utilizes only additional employees to absorb excess demand and the cost of that plan.
(e) Formulate the problem of optimizing Leather-All’s hiring
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
