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Problem 11-5 Manager T. C.
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Problem 11-5

Manager 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 normal capacity of 130 engines per month. Normal output has a cost of $60 per engine. The beginning inventory is zero engines. Overtime has a cost of $90 per engine.


 

 

Month

 

 12345678Total

  Forecast1201351401201251251401351,040


 

a.

Develop a chase plan that matches the forecast and compute the total cost of your plan. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)


 

  Period               1               2               3               4               5               6               7               8            Total

  Forecast1201351401201251251401351,040  

  Output         

    Regular

    Overtime

    Subcontract         

  Output - Forecast 

  Inventory         

    Beginning         

    Ending         

    Average         

  Backlog         

 

  Costs:         

  Output         

    Regular$ $

    Overtime

    Subcontract         

  Inventory         

  Backorder         

 

  Total$ $

 


 

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 $90 per engine per month. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)


 

  Period               1               2               3               4               5               6               7               8            Total

  Forecast1201351401201251251401351,040  

  Output         

    Regular

    Overtime         

    Subcontract         

  Output - Forecast 

  Inventory         

    Beginning 

    Ending 

    Average 

  Backlog 

 

  Costs:         

  Output         

    Regular$ $

    Overtime         

    Subcontract         

  Inventory

  Backorder

 

  Total$ $

 

 

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Problem 11-5 Manager T. C.
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  • Submitted On 25 Sep, 2015 11:26:28
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Problem 11-5 Manager 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 normal capacity of 130 engines per month. Normal output has a cost of $60 per engine. The beginning inventory is zero engines. Overtime has a cost of $90 per engine. Month 1 2 3 4 5 6 7 8 Total Forecast 120 135 140 120 125 125 140 135 1,040 a. Develop a chase plan that matches the forecast and compute the total cost of your plan. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever requir...
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