The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows:JanuaryFebruaryMarchAprilMonth0 December1 January2 February3 March4 April5 May6 June7 July8 AugustDemand1,4001,5001,6001,8002,1002,3001,4001,5001,6001,800Her operations manager is considering a new plan, which begins in January with 200 units of inventory on hand. Stockout cost of lost sales is $65 per unit. Inventory holding cost is $25 per unit per month. Ignore any idle-time costs. Evaluate the following plans D and E.Plan D: Keep the current workforce stable at producing 1,600 units per month. In addition to the regular production, another 20% of the normal production units can be produced in overtime at an additional cost of $50 per unit. A warehouse now constrains the maximum allowableinventory on hand to 600 units or less.Note: Do not produce in overtime if production or inventory are adequate to cover demand.1,8001,400Production(Units)1,6001,600MayJune1,6001,6001,6001,6001,6001,600JulyAugust2,1002,3001,8001,400Plan DO.T.EndingProduction (Units) Inventory200Stockouts (Units)

Aggregate planning is a technique to plan the forecast for different families of products and…

Answered: The president of Hill Enterprises,…

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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The table above provides the aggregate plan of production by a firm. It is known that the firm uses a level plan with backorders. Given this information, what is the number in the cell with the question mark?
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The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: May 2,100 January February 1,450 1,700 1,700 June 2,300 July 1,900 March April 1,700 August 1,300 Her operations manager is considering a new plan, which begins in January with 200 units of inventory on hand. Stockout cost of lost sales is $65 per unit. Inventory holding cost is $25 per unit per month. Ignore any idle-time costs. Evaluate the following plan. This exercise contains only Plan E. Plan E: Keep the current workforce, which is producing 1,600 units per month, and subcontract to meet the rest of the demand. Subcontract cost is $75 per unit. Month 10 December 1 January 2 February 3 March 4 April 5 May 6 June 7 July 8 August Demand 1,450 1,700 1,700 1,700 2,100 2,300 1,900 1,300 Production (Units) 1,600 1,600 1,600 1,600 1,600 1,600 1,600 1,600 Plan E Ending Subcontract (Units) Inventory 200 The total subcontracting cost = $ (Enter your response as…
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