A large Saskatchewan feed mill, B. Swart Processing, prepares its 6-month aggregate plan by forecasting demand for 50-pound bags of cattle feed as follows: January,

1,000

bags; February,

1,200;

March,

1,250;

April,

1,450;

May,

1,400;

and June,

1,400.

The feed mill plans to begin the new year with no inventory left over from the previous year and backorders are not permitted. It projects that capacity (during regular hours) for producing bags of feed will remain constant at

800

until the end of April, and then increase to

1,100

bags per month when a planned expansion is completed on May 1. Overtime capacity is set at

300

bags per month until the expansion, at which time it will increase to

400

bags per month. A friendly competitor in Alberta is also available as a backup source to meet

demandbut

can provide only

500

bags total during the 6-month period. Cost data are as follows:

Regular-time cost per bag (until April 30)	$12.00
Regular-time cost per bag (after May 1)	$11.00
Overtime cost per bag (during entire period)	$16.00
Cost of outside purchase per bag	$18.50
Carrying cost per bag per month	$1.00

Develop a 6-month production plan for the feed mill using the transportation method.

(Enter

your responses as whole numbers. Use the initial solution if it is optimal.)

Supply from	Demand for
	January	February	March	April	May	June	(Dummy) Excess	Supply

Jan	Regular time		$12.00		$13.00		$14.00		$15.00		$16.00		$17.00		$0	800
		nothing		nothing		nothing		nothing		nothing		nothing		nothing
	Overtime		$16.00		$17.00		$18.00		$19.00		$20.00		$21.00		$0	300
		nothing		nothing		nothing		nothing		nothing		nothing		nothing

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