The Westerbeck Company manufactures several models of automatic washers and dryers. The projected requirements over the next
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Current inventory is 100 units. Current capacity is 960 units per month. The average salary of production workers is $1,300 per month. Material costs $120/unit. Each production worker accounts for 30 units per month. Overtime is paid at time and a half. Any increase or decrease in the production rate costs $50/unit for tooling, setup, and line changes. This does not apply, however, to overtime. Inventory-holding costs are $25 per unit per month. Lost sales are valued at $75 per unit. Compare the costs of level and chase demand production plans.
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Related Book For
OM operations management
ISBN: 978-1285451374
5th edition
Authors: David Alan Collier, James R. Evans
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