University Press publishes textbooks for the academic market. The printing operations is semi-automated requiring only two people to turn on and off the machines, regardless of the output. The workforce is paid per unit produced. Demand for the four quarters is 5,000, 10,000. 30,000, and 25,000 books respectively. The relevant cost and printing equipment- related capacity information are given below.
University Press publishes textbooks for the academic market. The printing operations is semi-automated requiring only two people to turn on and off the machines, regardless of the output. The workforce is paid per unit produced. Demand for the four quarters is 5,000, 10,000. 30,000, and 25,000 books respectively. The relevant cost and printing equipment- related capacity information are given below.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Kindly help
![Question One
University Press publishes textbooks for the academic market. The printing operations is
semi-automated requiring only two people to turn on and off the machines, regardless of the
output. The workforce is paid per unit produced. Demand for the four quarters is 5,000,
10,000. 30,000, and 25,000 books respectively. The relevant cost and printing equipment-
related capacity information are given below.
Regular production cost = $20 per book Regular production max, capacity = 10,000 books per quarter
Overtime production cost = $30 per book Overtime production max. capacity = 5000 books per quarter
Subcontracting cost
= $35 per book Beginning inventory
=0
Quarterly Holding cost
= $2 per book
Required:
a) Prepare an aggregate production plan using a pure level approach with average
demand. What is the total cost of the initial plan?
b) Prepare an aggregate production plan using a pure chase approach. For this
question, ignore workforce-related costs since the cost information is not provided.
What is the total cost of the plan?
Page 1 of 4
c) Based on parts a) and b), develop an improved aggregate production plan in terms of
the total cost. The plan may deviate from a pure level or a pure chase approach.
Assume that no other information or objective will be considered. Provide the total
cost of the improved plan and explain briefly how you came up with your improved
plan.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F31211817-c6fc-40e1-a7a5-5f5383d5e7ea%2Ff8a16690-e541-4ce5-8973-5e937dfe9866%2Fdqc16c6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Question One
University Press publishes textbooks for the academic market. The printing operations is
semi-automated requiring only two people to turn on and off the machines, regardless of the
output. The workforce is paid per unit produced. Demand for the four quarters is 5,000,
10,000. 30,000, and 25,000 books respectively. The relevant cost and printing equipment-
related capacity information are given below.
Regular production cost = $20 per book Regular production max, capacity = 10,000 books per quarter
Overtime production cost = $30 per book Overtime production max. capacity = 5000 books per quarter
Subcontracting cost
= $35 per book Beginning inventory
=0
Quarterly Holding cost
= $2 per book
Required:
a) Prepare an aggregate production plan using a pure level approach with average
demand. What is the total cost of the initial plan?
b) Prepare an aggregate production plan using a pure chase approach. For this
question, ignore workforce-related costs since the cost information is not provided.
What is the total cost of the plan?
Page 1 of 4
c) Based on parts a) and b), develop an improved aggregate production plan in terms of
the total cost. The plan may deviate from a pure level or a pure chase approach.
Assume that no other information or objective will be considered. Provide the total
cost of the improved plan and explain briefly how you came up with your improved
plan.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 5 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education