Certain producer of projection units requires

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Reference no: EM131367575

A certain producer of projection units requires that a four-month aggregate plan be developed. Demand and capacity (in units) are forecast as follows:

Capacity 1st Month 2nd Month 3rd Month 4th Month

Reg. Time Labor 235 255 290 300

Overtime Labor 20 24 26 24

Subcontract 12 15 15 17

Demand 255 294 321 301

The cost of producing each projection unit is $985 on regular time, $1,310 on overtime, and $1,500 on a subcontract. Inventory carrying cost is $100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Set up a production plan that minimizes cost using the transportation method.

Reference no: EM131367575

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