Complete the following aggregate plan for January through April using the Chase
ID: 469652 • Letter: C
Question
Complete the following aggregate plan for January through April using the Chase Strategy. Additional Information: Inventory holding cost = $10 per unit per month, Hiring cost = $50 per unit, Firing cost = $100 per unit, December Production = 230 units Basic Production Cost = $10 per unit Period
Forecast Prior Production Inventory # hire units # fire units Extra Cost December ----- 20 ----- ----- J
anuary 350 February 300 March 280 April 460 Complete the following aggregate plan for January through April using the Chase Strategy. Additional Information: Inventory holding cost = $10 per unit per month, Hiring cost = $50 per unit, Firing cost = $100 per unit, Basic Production Cost = $10 per unit December Production 200 units
Period Forecast Prior Production Inventory hire unts fire units extra cost
December 20
January 350
February 300
March 280
April 460
Explanation / Answer
Inventory holding cost = $10 per unit per month
Hiring cost = $50 per unit
Firing cost = $100 per unit
December Production = 230 units
Basic Production Cost = $10 per unit Period
Extra cost = Hiring cost x hire units + Firing cost x fire units
Period
Forecast
Prior Production
Inventory
Actual Production
hire units
Fire units
Extra Cost
Prod. Cost
Total Cost
December
20
January
350
200
0
330
130
0
$6500
$3300
$9800
February
300
330
0
300
0
30
$3000
$3000
$6000
March
280
300
0
280
0
20
$2000
$2800
$4800
April
460
280
0
460
180
0
$9000
$4600
$13600
Total Cost of Case plan = Total (Hiring + Firing + Production) costs
Total Cost of plan = $9,800 + $6,000 + $4,800 + $13,600 = $34,200
Total Cost of chase plan = $34,200
Period
Forecast
Prior Production
Inventory
Actual Production
hire units
Fire units
Extra Cost
Prod. Cost
Total Cost
December
20
January
350
200
0
330
130
0
$6500
$3300
$9800
February
300
330
0
300
0
30
$3000
$3000
$6000
March
280
300
0
280
0
20
$2000
$2800
$4800
April
460
280
0
460
180
0
$9000
$4600
$13600