Develop and complete the total cost for each plan

Reference no: EM1319279

Develop and complete the total cost for each plan. Find the plan which has the lowest total cost.

Now Juice Inc., produces bottled pomegranate juice. A planner has developed an aggregate forecast for demand (in cases) for the next six months.

Month:	May	June	July	Aug.	Sept.	Oct.
Forecast	4,000	48,000	5,600	7,200	6,400	5,000

Use the following information to expand aggregate plans.

Regular production cost	$10 per case
Regular production capacity	5,000 cases
Overtime production cost	$16 per case
Subcontracting cost	$20 per case
Holding cost	$1 per case per month
Beginning inventory	0

Expand and aggregate plan using each of the following guidelines and complete the total cost for each plan. Which plan has the lowest total cost?
a. utilize level production. Supplement using overtime as needed.
b. apply a combination overtime (500 cases per period maximum), inventory, and subcontracting (500 cases per period maximum) to handle variations in demand.
c. Use overtime up to 750 cases per period and inventory to handle variations in demand.

Reference no: EM1319279

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