Problem:

Question:

Please show step by step calculation and detail explanation. Thank you.

4. On December 20 (the end of the fourth quarter), Ivar Jorgenson, head operations planner for Ski \& Sea, Inc., is in charge of developing a sales and operations plan for the coming year. Ski \& Sea assembles jet skis and snowmobiles from subassemblies and component parts provided by reliable vendors. Both products (end items) utilize the same small engines and many of the same parts. They require the same assembly time and employee labor skills. The available planning information is as follows: Demand Forecasts during a period produce at least 500 units). If overtime is used, up to another 200 units can be produced per employee. a. Develop an operations plan that utilizes a level, or constant, rate of output each quarter using fulltime regular employees only. Ending inventory and back orders for quarter 4 must be equal to 1600 units. Summarize the plan, its costs, and its consequences b. Prepare a cumulative chart for your plan in Part: a of this problem. c. If each shipping container for completed jet skis and snowmobiles requires 25cu.ft. of space, what is the maximum finished-goods warehouse space you will need next year if the plan in Part b of this problem is adopted. d. If the cost of each completed end item is $750, what is the maximum amount of capital that will be tied up in finished-goods inventory during the year