Problem 11-9 Wormwood, Ltd., produces a variety of furniture products. The plann
ID: 447370 • Letter: P
Question
Problem 11-9 Wormwood, Ltd., produces a variety of furniture products. The planning committee wants to prepare an aggregate plan for the next six months using the following information: MONTH 1 2 3 4 5 6 Demand 160 150 160 180 170 140 Capacity Regular 150 150 150 150 160 160 Overtime 10 10 0 10 10 10 Cost Per Unit Regular time $53 Overtime 72 Subcontract 79 Inventory, per period 3 Subcontracting can handle a maximum of 10 units per month. Beginning inventory is zero. Develop a plan that minimizes total cost. No back orders are allowed. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.) Period 1 2 3 4 5 6 Total Forecast 160 150 160 180 170 140 960 Output Regular 150 150 150 150 160 140 900 Overtime 10 10 0 10 10 0 40 Subcontract Output- Forecast Inventory Beginning Ending Average Backlog Costs: Regular $ $ Overtime Subcontract Inventory Backlog Total
Explanation / Answer
MONTH 1 2 3 4 5 6 Demand 160 150 160 180 170 140 Capacity Regular 150 150 150 150 160 160 Overtime 10 10 0 10 10 10 Cost Per Unit Regular time $53 Overtime $72 Subcontract $79 Inventory, per period $3 Period 1 2 3 4 5 6 Total Forecast (A) 160 150 160 180 170 140 960 Output Regular (B) 150 150 150 150 160 140 900 Overtime (C ) 10 10 0 10 10 0 40 Subcontract (D = A-B-C), if >0 0 0 0 20 0 0 20 Output- Forecast ( E) 160 160 150 180 170 140 960 Inventory Beginning (Last period ending) 0 0 10 0 0 0 10 Ending (E - A, if positive) 0 10 0 0 0 0 10 Average 0 5 5 0 0 0 10 Backlog 0 0 0 0 0 0 0 Costs: Regular (Regular Output * $53) $7,950 $7,950 $7,950 $7,950 $8,480 $7,420 $47,700 Overtime (Overtime Output * $72) $720 $720 $0 $720 $720 $0 $2,880 Subcontract (Subcontract Output * $79) $0 $0 $0 $1,580 $0 $0 $1,580 Inventory (Average Inventory * $3) $0 $15 $15 $0 $0 $0 $30 Backlog $0 $0 $0 $0 $0 $0 $0 Total $8,670 $8,685 $7,965 $10,250 $9,200 $7,420 $52,190