Reference no: EM132205286
Cost data
Regular time labor cost per hour $10
Overtime time labor cost per hour $15
Subcontracting cost per unit (labor only) $80
Back order cost per unit per period $20
Inventory holding cost per unit per period $10
Hiring cost per employee $500
Firing cost per employee $400
Capacity data
Beginning workforce 40 employees
Beginning inventory 0 units
Beginning back orders 0 units
Production standard per unit (hours) 2 hours of labor per unit
Regular time available per period (hours) 160 hours per period per employee
Overtime time available per period (hours) 30 hours per period per employee
Demand data
Period 1 3,920 units Period 5 3,800 units
Period 2 2,480 units Period 6 4,340 units
Period 3 2,200 units Period 7 4,820 units
Period 4 3,280 units Period 8 4,600 units
Develop a chase aggregate plan without inventory and back orders. Do no hiring or firing. When demand exceeds regular production, use overtime up to its maximum and then subcontracting. When demand is less than regular production, use undertime (data given above).
(a) What are the total hours of overtime per employee for the plan?
(b) How many total units are produced using subcontracting?
(c) What are the total hours of undertime per employee for the plan?
(d) What is the total cost?
(e) What is the cost per unit?