Practical Management Science
Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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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:
 
demand forecast.                
Quarter
Forecast
1
1,900
2
1,200
3
1,600
4
800
​Costs/Other Data
Previous​ quarter's
output=1,200 cases
Beginning
inventory=0 cases
Stockout cost of
backorders=​$160 per case
Inventory holding
cost=​$40
per case at end of quarter
Hiring
employees=​$35 per case
Terminating
employees=​$80 per case
Subcontracting
cost=​$65 per case
Unit cost on regular
time=​$30 per case
Overtime
cost=​$20 extra per case
Capacity on regular
time=1,900 cases per quarter
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
1,100
cases per quarter and meets the forecast demand with inventory and subcontracting.
Part 2
​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
Quarter
Forecast
Production
Hire
​(Units)
Layoff
​(Units)
 
 
1,200
 
 
1
1,900
enter your response here
enter your response here
enter your response here
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Follow-up Question
Construct a plan that holds employment steady​ (level strategy) by producing the average forecast for all four quarters ​(enter your responses as whole​ numbers).
 
Level Plan
Quarter
Forecast
Production
Ending Inventory
Shortage
Hire
​(Units)
Layoff
​(Units)
 
 
1,200
 
 
 
 
1
1,900
enter your response here
enter your response here
enter your response here
enter your response here
enter your response here
Solution
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Follow-up Question

The total​ cost, including normal time labor​ costs, for this hiring and layoffs plan is

​$enter your response here

​(enter your response as a whole​ number).

Solution
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Follow-up Question
The total​ cost, including normal time labor​ costs, for this hiring and layoffs plan is
​$ enter your response here
​(enter your response as a whole​ number).
 
 
 
Solution
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Follow-up Questions
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Follow-up Question
Construct a plan that holds employment steady​ (level strategy) by producing the average forecast for all four quarters ​(enter your responses as whole​ numbers).
 
Level Plan
Quarter
Forecast
Production
Ending Inventory
Shortage
Hire
​(Units)
Layoff
​(Units)
 
 
1,200
 
 
 
 
1
1,900
enter your response here
enter your response here
enter your response here
enter your response here
enter your response here
Solution
Bartleby Expert
by Bartleby Expert
SEE SOLUTION
Follow-up Question

The total​ cost, including normal time labor​ costs, for this hiring and layoffs plan is

​$enter your response here

​(enter your response as a whole​ number).

Solution
Bartleby Expert
by Bartleby Expert
SEE SOLUTION
Follow-up Question
The total​ cost, including normal time labor​ costs, for this hiring and layoffs plan is
​$ enter your response here
​(enter your response as a whole​ number).
 
 
 
Solution
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by Bartleby Expert
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