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Given the information in the table below, answer question A, B and C. Assuming the company chooses to pursue a Level Production Strategy.
Question A. How many workers are needed to meet the projected demand?
Question B. What will the Total month ending inventory be over the 4 month period?
Question C. What will the total inventory carrying cost be over the 4 month period?
Cost information
Inventory carrying cost $3 per unit per month
Labor hours to produce a unit 2 hours per unit
Demand information
Month Expected Demand Production Days Demand per day (computed)
Jan 600 20 30
Feb 720 20 36
Mar 1100 20 55
Apr 1500 20 75
3920 80
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