Question: PLEASE ANSWER THIS QUESTION Problem 11-5 (Algo) Manager T. C. Downs of Plum Engines, a producer of lawn mowers and leaf blowers, must develop an

PLEASE ANSWER THIS QUESTION
Problem 11-5 (Algo) Manager T. C. Downs of Plum Engines, a producer of lawn mowers and leaf blowers, must develop an aggregate plan given the forecast for engine demand shown in the table. The department has a regular output capacity of 145 engines per month. Regular output has a cost of $60 per engine. The beginning inventory is zero engines. Overtime has a cost of $110 per engine. 1 125 2 135 3 143 Month 4 5 144 125 6 165 7 140 8 143 Total 1,120 Forecast b. Compare the costs to a level plan that uses inventory to absorb fluctuations. Inventory carrying cost is $2 per engine per month. Backlog cost is $125 per engine per month. There should not be a backlog in the last month. Set regular production equal to the monthly average of total forecasted demand. Assume that using overtime is not an option. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Round average inventory row, Inventory cost row, and Total row values to 1 decimal.) Period 2 3 4 5 6 7 8 Total Forecast 125 135 143 144 125 165 140 143 1,120 Output Regular Output - Forecast Inventory Beginning Ending Average Backlog Costs Output Regular Inventory Backorder TotalStep by Step Solution
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