Plan production for a four-month period: February through May. For February and March, you should produce to exact demand forecast. For April and May, you should use overtime and inventory with a stable workforce; stable means that the number of workers needed for March will be held constant through May. However, government constraints put a maximum of 5,000 hours of overtime labor per month in April and May (zero overtime in February and March). If demand exceeds supply, then backorders occur. There are 95 workers on January 31. You are given the following demand forecast: February, 80,256; March, 66,880; April, 100,120; May, 40,120. Productivity is four units per worker hour, eight hours per day, 22 days per month. Assume zero inventory on February 1. Costs are hiring, $44 per new worker; layoff, $64 per worker laid off; inventory holding, $8 per unit-month; straight-time labor, $8 per hour; overtime, $12 per hour; backorder, $16 per unit. Develop a production plan and calculate the total cost of this plan. Note: Assume any layoffs occur at beginning of next month. (Leave no cells blank - be certain to enter "O" wherever required. Negative values should be indicated by a minus sign. Round your answers to the nearest whole number.)
Plan production for a four-month period: February through May. For February and March, you should produce to exact demand forecast. For April and May, you should use overtime and inventory with a stable workforce; stable means that the number of workers needed for March will be held constant through May. However, government constraints put a maximum of 5,000 hours of overtime labor per month in April and May (zero overtime in February and March). If demand exceeds supply, then backorders occur. There are 95 workers on January 31. You are given the following demand forecast: February, 80,256; March, 66,880; April, 100,120; May, 40,120. Productivity is four units per worker hour, eight hours per day, 22 days per month. Assume zero inventory on February 1. Costs are hiring, $44 per new worker; layoff, $64 per worker laid off; inventory holding, $8 per unit-month; straight-time labor, $8 per hour; overtime, $12 per hour; backorder, $16 per unit. Develop a production plan and calculate the total cost of this plan. Note: Assume any layoffs occur at beginning of next month. (Leave no cells blank - be certain to enter "O" wherever required. Negative values should be indicated by a minus sign. Round your answers to the nearest whole number.)
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Transcribed Image Text:Plan production for a four-month period: February
through May. For February and March, you should
produce to exact demand forecast. For April and
May, you should use overtime and inventory with a
stable workforce; stable means that the number of
workers needed for March will be held constant
through May. However, government constraints put
a maximum of 5,000 hours of overtime labor per
month in April and May (zero overtime in February
and March). If demand exceeds supply, then
backorders occur. There are 95 workers on January
31. You are given the following demand forecast:
February, 80,256; March, 66,880; April, 100,120;
May, 40,120. Productivity is four units per worker
hour, eight hours per day, 22 days per month.
Assume zero inventory on February 1. Costs are
hiring, $44 per new worker; layoff, $64 per worker
laid off; inventory holding, $8 per unit-month;
straight-time labor, $8 per hour; overtime, $12 per
hour; backorder, $16 per unit. Develop a production
plan and calculate the total cost of this plan. Note:
Assume any layoffs occur at beginning of next
month. (Leave no cells blank - be certain to enter "O"
wherever required. Negative values should be
indicated by a minus sign. Round your answers to
the nearest whole number.)
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