Reference no: EM132201652

Andrew–Carter, Inc. (A–C), is a major Canadian producer and distributor of outdoor lighting fixtures. Its fixture is distributed throughout North America and has been in high demand for several years. The company operates three plants that manufacture the fixture and distribute it to five distribution centers (warehouses).

During the present recession, A–C has seen a major drop in demand for its fixture as the housing market has declined. Based on the forecast of interest rates, the head of operations feels that demand for housing and thus for its product will remain

depressed for the foreseeable future. A–C is considering closing one of its plants, as it is now operating with a forecasted excess capacity of 34,000 units per week. The forecasted weekly demands for the coming year are

Warehouse 1 9,000 units

Warehouse 2 13,000 units

Warehouse 3 11,000 units

Warehouse 4 15,000 units

Warehouse 5 8,000 units

The plant capacities in units per week are

Plant 1, regular time 27,000 units

Plant 1, on overtime 7,000 units

Plant 2, regular time 20,000 units

Plant 2, on overtime 5,000 units

Plant 3, regular time 25,000 units

Plant 3, on overtime 6,000 units

If A–C shuts down any plants, its weekly costs will change, as fixed costs are lower for a nonoperating plant. Table 9.34 shows production costs at each plant, both variable at regular time and overtime, and fixed when operating and shut down.

Table 9.35 shows distribution costs from each plant to each warehouse (distribution center).

Discussion Questions

1. Evaluate the various configurations of operating and closed plants that will meet weekly demand. Determine which configuration minimizes total costs.

2. Discuss the implications of closing a plant.

I need the step by step on how to solve this using excel solver.

The solutions already posted are hard to read what to do in excel, and I am having trouble with this problem using excel solver.