Concept explainers
a)
To develop: Aggregate planning by considering hiring and layoff.
Introduction: The aggregate plan is the output of sales and operations planning. The major concern of aggregate planning is the production time and quantity for the intermediate future. Aggregate planning would encompass a time prospect of approximately 3 to 18 months.
b)
To determine: Develop aggregate planning using level plan.
Introduction: The aggregate plan is the output of sales and operations planning. The major concern of aggregate planning is the production time and quantity for the intermediate future. Aggregate planning would encompass a time prospect of approximately 3 to 18 months.
c)
To determine: The economically advantage plan
Introduction: The aggregate plan is the output of sales and operations planning. The major concern of aggregate planning is the production time and quantity for the intermediate future. Aggregate planning would encompass a time prospect of approximately 3 to 18 months.
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EBK PRINCIPLES OF OPERATIONS MANAGEMENT
- Deb Bishop Health and Beauty Products has developed a new shampoo and you need to develop its aggregate schedule. The cost accounting department has supplied you the cost relevant to the aggregate plan and the marketing department has provided a four-quarter forecast. Click the icon to view the four-quarter forecast. Click the icon to view the costs relevant to the aggregate plan. Your job is to develop an aggregate plan for the next four quarters. a) Try hiring and layoffs (to meet the forecast) as necessary (enter your responses as whole numbers). More Info Hiring and Layoff Plan Hire Layoff Quarter Forecast Production (Units) (Units) 1,600 1 1,400 1400 0 200 2 1,000 1,000 0 400 3 1,600 1,600 600 0 4 1,200 ☑ More Info Previous quarter's output Beginning inventory Stockout cost for backorders Inventory holding cost Hiring workers Layoff workers Unit cost Overtime Subcontracting Costs 1,600 units $45 per unit O units $11 per unit for every unit held at the end of the quarter $50 per…arrow_forwardNote:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forwardWhy do operations planning require that a forecast be expressed in terms of physical units for an individual goods and services?arrow_forward
- Southeast Soda Pop, Inc., has a new fruit drink for which it has high hopes. John Mittenthal, the production planner, has assembled the following cost data and demand forecast: Click the icon to view the demand forecast. E Click the icon to view the cost data. John's job is to develop an aggregate plan. The three initial options he wants to evaluate are: • Plan A: a strategy that hires and fires personnel as necessary to meet the forecast. • Plan B: a level strategy. • Plan C: a level strategy that produces 1,000 cases per quarter and meets the forecast demand with inventory and subcontracting. a) Which strategy is the lowest-cost plan? Try hiring and layoffs (to meet the forecast) as necessary (enter your responses as whole numbers). Hiring and Layoff Plan Layoff (Units) Hire Quarter Forecast Production Inits) 1,300 1 1,700 Costs/Other Data Previous quarter's output = 1,300 cases Beginning inventory = 0 cases Stockout cost of backorders = $140 per case Inventory holding cost = $45 per…arrow_forwardPlease do not write in column A Problem 6 Given the following forecast and cost information, determine the total cost of a plan that uses regular time production output of 600 units per month, overtime is used when needed up to a maximum of 60 units per month, and subcontracting is used if additional units are needed to meet the forecast. Regular time cost $ 40.00 per unit Overtime cost $ 60.00 per unit subcontracting cost $ 80.00 per unit holding cost $ 10.00 per unit per month Production Inventory Costs Month Forecast Level Production Overtime Subcontracting Total Holding Cost Regular Time Overtime Subcontracting Total Cost 1 563 0 2 608 3 648 4 668 5 666 6 688 Totalsarrow_forwardCreate a minimum cost chase plan for the forecast shown in the table. There is no beginning inventory and regular production capacity is 350 units and costs $8 per unit. Overtime costs $19 and is limited to 50 units per month and subcontracting is limited to 100 units per month and costs $14 per unit. What is the total plan cost? Hint: In a chase production plan, production is changed each time period to match the demand. Use regular production, overtime, and subcontracting to create the plan. Month Forecast Regular Overtime Subcontracting January 250 February 400 March 500 April 350arrow_forward
- NowJuice, Inc. produces bottled pickle juice. A planner has developed an aggregate forecast for demand (in cases) for the next four months. Use the following information to develop an aggregate plan using the LEVEL strategy. Inventory holding cost is $1 per month per case and backlog cost is $5 per month per case. Beginning inventory is zero. Month May June July August Forecast 452 520 600 719 Cost Per Unit Monthly Capacity Regular Production 19.40 400 Overtime Production 1.5 x Regular Prod Cost 400 What is the TOTAL cost of the LEVEL plan over the planning horizon? Correct Answer 51,588.6 CAN SOMEONE SHOW ME HOW THEY GOT THE ANSWER 51588.6arrow_forwardExplain the concept of demand forecasting and its role in operations planning.arrow_forwardplease answer within 30 minutes. its urgent.arrow_forward
- Deb Bishop Health and Beauty Products has developed a new shampoo and you need to develop its aggregate schedule. The cost accounting department has supplied you the cost relevant to the aggregate plan and the marketing department has provided a four-quarter forecast. the four-quarter forecast. Quarter Forecast 1 1,400 2 1,100 3 1,700 4 1,300 the costs relevant to the aggregate plan. Costs Previous quarter's output 1,600 units Beginning inventory 0 units Stockout cost for backorders $55 per unit Inventory holding cost $11 per unit for every unit held at the end of the quarter Hiring workers $50 per unit Layoff workers $75 per unit Unit cost $35 per unit Overtime $20 extra per unit Subcontracting Not available Your job is to develop an aggregate plan for the next four quarters. Part 2 a) Try hiring and layoffs (to meet the forecast) as necessary…arrow_forwardManager T. C. Downs of Plum Engines, a producer of lawn mowers and leaf blowers, must develop an aggregate plan given the forecast for engine demand shown in the table. The department has a regular output capacity of 135 engines per month. Regular output has a cost of $60 per engine. The beginning inventory is zero engines. Overtime has a cost of $100 per engine. a. Develop a chase plan that matches the forecast and compute the total cost of your plan. Regular production can be less than regular capacity. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required.) b. Compare the costs to a level plan that uses inventory to absorb fluctuations. Inventory carrying cost is $2 per engine per month. Backlog cost is $120 per engine per month. There should not be a backlog in the last month. Set regular production equal to the monthly average of total forecasted demand. Assume that using overtime is not an option. (Negative amounts…arrow_forwardDetermine the total cost for this plan given the following forecast:Month 1 2 3 4 5 6Forecast 380 400 420 440 460 480Use steady regular output of 400 units per month, use overtime as needed for up to 40 units permonth, and use subcontracting to make up any needed output to match the forecast. Unit costs are:Regular output = $25Overtime = $40Subcontract = $60Average Balance Inventory = $15arrow_forward
- Management, Loose-Leaf VersionManagementISBN:9781305969308Author:Richard L. DaftPublisher:South-Western College Pub