Principles Of Operations Management
Principles Of Operations Management
11th Edition
ISBN: 9780135173930
Author: RENDER, Barry, HEIZER, Jay, Munson, Chuck
Publisher: Pearson,
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Chapter 13, Problem 18P
Summary Introduction

To determine: The minimum cost using the transportation method.

Introduction: Aggregate planning using transportation method helps to attain minimum cost using the optimal plan. The major advantage of transportation method is to achieve the optimal solution using optimal plans.

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Advise the MD, providing detailed explanation using the table above.
Jerusalem Medical Ltd., an Israeli producer of portable kidney dialysis units and other medical products, develops a 4-month aggregate plan. Demand and capacity (in units) are forecast as follows: Capacity Source Month 1 Month 2 245 275 F1111 15 24 14 15 260 314 Labor Regular time Overtime Subcontract Demand Month 3 280 26 18 316 Month 4 300 24 15 301 The cost of producing each dialysis unit is $875 on regular time, $1,310 on overtime, and $1,500 on a subcontract. Inventory carrying cost is $100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Minimizing cost using the transportation method, the optimal cost is $ (enter your response as a whole number).
Jerusalem Medical​ Ltd., an Israeli producer of portable kidney dialysis units and other medical​ products, develops a​ 4-month aggregate plan. Demand and capacity​ (in units) are forecast as​ follows:                                                                                                                    Capacity Source Month 1 Month 2 Month 3 Month 4 Labor               Regular time 245 275 280 300       Overtime 15 24 26 28 Subcontract 12 17 20 15 Demand 260 316 316 305   The cost of producing each dialysis unit is ​$985 on regular​ time, ​$1,310 on​ overtime, and ​$1,600 on a subcontract. Inventory carrying cost is ​$100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Minimizing cost using the transportation​ method, the optimal cost is ​$nothing ​(enter your response as a whole​ number).
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