The president of Hill​ Enterprises, Terri​ Hill, projects the​ firm's aggregate demand requirements over the next 8 months as​ follows:     January 1,400 May 2,200 February 1,600 June 2,300 March 1,600 July 1,700 April 1,900 August 1,300   Her operations manager is considering a new​ plan, which begins in January with 200 units on hand and ends with zero inventory. Stockout cost of lost sales is ​$125 per unit. Inventory holding cost is ​$25 per unit per month. Ignore any​ idle-time costs. The plan is called plan B.   Plan​ B: Produce at a constant rate of 1,300 units per​ month, which will meet minimum demands. Then use​ subcontracting, with additional units at a premium price of ​$80 per unit. Subcontracting capacity is limited to 1,000 units per month. Evaluate this plan by computing the costs for January through August. Part 2 In order to arrive at the​ costs, first compute the ending inventory and subcontracting units for each month by filling in the table below ​(enter your responses as whole​ numbers).   Period   Month Demand   Production Ending Inventory Subcontract Units 0 December     200   1 January 1,400 1,300 enter your response here enter your response here 2 February 1,600 1,300 enter your response here enter your response here 3 March 1,600 1,300 enter your response here enter your response here 4 April 1,900 1,300 enter your response here enter your response here 5 May 2,200 1,300 enter your response here enter your response here 6 June 2,300 1,300 enter your response here enter your response here 7 July 1,700 1,300 enter your response here enter your response here 8 August 1,300

Practical Management Science
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ISBN:9781337406659
Author:WINSTON, Wayne L.
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Chapter2: Introduction To Spreadsheet Modeling
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The president of Hill​ Enterprises, Terri​ Hill, projects the​ firm's aggregate demand requirements over the next 8 months as​ follows:  
 
January
1,400
May
2,200
February
1,600
June
2,300
March
1,600
July
1,700
April
1,900
August
1,300
 
Her operations manager is considering a new​ plan, which begins in January with
200
units on hand and ends with zero inventory. Stockout cost of lost sales is
​$125
per unit. Inventory holding cost is
​$25
per unit per month. Ignore any​ idle-time costs. The plan is called plan B.
 
Plan​ B: Produce at a constant rate of
1,300
units per​ month, which will meet minimum demands. Then use​ subcontracting, with additional units at a premium price of
​$80
per unit. Subcontracting capacity is limited to
1,000
units per month. Evaluate this plan by computing the costs for January through August.
Part 2
In order to arrive at the​ costs, first compute the ending inventory and subcontracting units for each month by filling in the table below ​(enter your responses as whole​ numbers).
 
Period
 
Month
Demand
 
Production
Ending Inventory
Subcontract Units
0
December
 
 
200
 
1
January
1,400
1,300
enter your response here
enter your response here
2
February
1,600
1,300
enter your response here
enter your response here
3
March
1,600
1,300
enter your response here
enter your response here
4
April
1,900
1,300
enter your response here
enter your response here
5
May
2,200
1,300
enter your response here
enter your response here
6
June
2,300
1,300
enter your response here
enter your response here
7
July
1,700
1,300
enter your response here
enter your response here
8
August
1,300
 
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