The president'of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as followsJanuaryFebruary1,4501,600May2,3002,2001,900JuneMarch1,7001,700JulyAprilAugust1,300Her operations manager is considering a new plan, which begins in January with 200 units of inventory on hand. Stockout cost of lost sales is $60 per unit. Inventory holding cost is $20 per unit per month Ignore any idle-lime costs. Evaluate the foilowing planThis exercise contains only Plan EPlan 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.Plan EProductionSubcontractEndingInventoryMonthO December1 JanuaryDemand(Units)(Units)2001,4501,6002 February1,6001,6003 March1,7001,6004 April1,7001,6005 May2,3001,6006 June7 July8 August2,2001,6001,9001,6001,3001,600The total subcontracting cost = S (Enter your response as a whole number)The total inventory holding cost for January through August = $. (Enter your response as a whole number.)The total cost, excluding normal time labor costs, for Plan E = S (Enter your response as a whole number.)

Given: Subcontracted cost per unit = 75 Inventory holding cost per unit = 20

Answered: The total subcontracting cost = sO…

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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Product Cost under Full vs. Variable Costing Kate’s Kale Chips produces a healthy snackmade primarily of kale. Each bag of the product sells for $5. The company computes the manufacturing overhead rate on a quarterly basis based upon the planned number of units to be produced thatquarter. The following data are from the projections of Kate’s Kale Chips for the upcoming quarter:[LO 18-4]ProjectionsSales 20,000 bagsProduction 22,000 bagsVariable manufacturing cost per bag $2.00Sales and distribution costs per bag $0.15Total fixed manufacturing overhead $33,000Fixed administrative overhead $18,000Required1. Compute the projected product cost per bag produced under full costing.2. Compute the projected product cost per bag under variable costing
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The total subcontracting cost = sO (Entor your response as a whole number) The total inventory holding cost for January through August = S (Enter your response as a whole number) The total cost, excluding normal time labor costs, for Plan E = S (Enter your respornse as a whole number.)