QUESTION #1 A. Based on the forecasted demand and cost information provided, decide which of the following the most appropriate planning strategy for Sweet-Pedas Caf: 1) Use a strategy with permanent of 6 workers with a support of overtime not more than 2 workers, and back ordering but no subcontracting is allowed. Jan 400 Feb 500 March 600 April 900 May 1100 June 700 Current work force Production per worker Inventory holding cost Regular wage rate Overtime wage rate Sub-contracting wage rate Back-ordering wage rate Hiring cost Firing cost Beginning inventory 9 workers 100 units per month $0.30 per unit per month $20.00 per unit $30.00 per unit $40.00 per unit $50.00 per unit $500 per worker $800 per worker 100 units Workers H F Month Demand Regular Production OT S/K Ending Inventory Back order F M M TOTAL Cost = 2) Use the level production strategy with a support of overtime not more than 3 workers and sub-contracting as needed. Feb Jan 400 March 600 500 April 900 May 1100 June 700 Current work force Production per worker Inventory holding cost Regular wage rate Overtime wage rate Sub-contracting wage rate Back-ordering wage rate Hiring cost Firing cost Beginning inventory 9 workers 100 units per month $0.30 per unit per month $20.00 per unit $30.00 per unit $40.00 per unit $50.00 per unit $500 per worker $800 per worker 100 units Workers H H F Month Demand Regular Production OT S/K Ending Inventory Back order J . F M M A M TOTAL Cost = 3) Use the level production strategy from January to April with a support of overtime not more than 2 workers and back-order as needed. Use chase demand strategy in May and June. Jan 400 Feb 500 March 600 April May 1100 June 700 900 Current work force Production per worker Inventory holding cost Regular wage rate Overtime wage rate Sub-contracting wage rate Back-ordering wage rate Hiring cost Firing cost Beginning inventory 9 workers 100 units per month $0.30 per unit per month $20.00 per unit $30.00 per unit $40.00 per unit $50.00 per unit $500 per worker $800 per worker 100 units Workers H F Month Demand Regular Production OT S/K Ending Inventory Back order F M A M TOTAL Cost =