Answered: Planners for a company that makes…

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...

See similar textbooks

Related questions

Concept explainers

Question

Planners for a company that makes several models of skateboards are about to
prepare the aggregate plan that will cover six periods. They now want to
evaluate a plan that calls for a steady rate of regular output, mainly using
inventory to absorb the uneven demand but allowing some backlog. Overtime
and subcontracting are not used because they want a 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 following information. Assume a level of output
rate of 300 units per period with regular time. Note that the planned ending
inventory is zero. There are 15 workers, and each can produce 20 units per

Period	1	2	3	4	5	6	Total
Forecast	200	200	300	400	500	200	1800

Cost Information:
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

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.

Similar questions