Planners for a company that makes several models of skateboards are about to prepare theaggregate plan that will cover six periods. They have assembled the following information.Period 1 2 3 4 5 6 TotalForecast 200 200 300 400 500 200 1,800CostsOutputRegular time = $2 per skateboardOvertime = $3 per skateboardSubcontract = $6 per skateboardInventory = $1 per skateboard per period on average inventoryBack orders = $5 per skateboard per periodThey now want to evaluate a plan that calls for a steady rate of regular-time output,mainly using inventory to absorb the uneven demand but allowing some backlog. Overtimeand subcontracting are not used because they want steady output. They intend to start withzero inventory on hand in the first period. Prepare an aggregate plan and determine its costusing the preceding information. Assume a level output rate of 300 units (skateboards) perperiod with regular time (i.e., 1,800/6 = 300). Note that the planned ending inventory iszero. There are 15 workers, and each can produce 20 skateboards per period.
Planners for a company that makes several models of skateboards are about to prepare the
aggregate plan that will cover six periods. They have assembled the following information.
Period 1 2 3 4 5 6 Total
Forecast 200 200 300 400 500 200 1,800
Costs
Output
Regular time = $2 per skateboard
Overtime = $3 per skateboard
Subcontract = $6 per skateboard
Inventory = $1 per skateboard per period on average inventory
Back orders = $5 per skateboard per period
They now want to evaluate a plan that calls for a steady rate of regular-time output,
mainly using inventory to absorb the uneven demand but allowing some backlog. Overtime
and subcontracting are not used because they want steady output. They intend to start with
zero inventory on hand in the first period. Prepare an aggregate plan and determine its cost
using the preceding information. Assume a level output rate of 300 units (skateboards) per
period with regular time (i.e., 1,800/6 = 300). Note that the planned ending inventory is
zero. There are 15 workers, and each can produce 20 skateboards per period.
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