Use the information below to answer questions 4(a) - 4(c) Number of Working Days 22 18...
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Use the information below to answer questions 4(a) - 4(c) Number of Working Days 22 18 21 21 22 20 Month January February March April May June Cost Information: Inventory carrying cost Demand per Day 41 39 38 57 68 55 $5 per unit per month Subcontracting cost per unit Average pay rate Overtime pay rate Labor-hours to produce a unit Cost of Increasing daily production rate (hiring and training) Cost of decreasing daily production rate (layoffs) Question: a) The plan 1 (constant workforce). $10 per unit $5 per hour ($45 /day) $7 per hour (above 8 hours per day) 1.6 hours per unit $300 per unit $600 per unit The production 50 units per day. How much total units of inventory carried over from one month to the next? If the workforce required to produce 50 units per day = 10, how much the total costs? b) The Plan 2 (subcontracting). If minmimum requirement = 38 units per day. How much in-house production? and how much the subcontracting units? How is the total costs (regular and subcontracting)? c) The plan 3 (firing and hiring). Calculate the Basic Production cost, extra cost of increasing production (hiring cost), extra cost of decreasing production (layoff cost) and the total costs (for each month). And compare the three plans, which plan has a lowest cost option? Use the information below to answer questions 4(a) - 4(c) Number of Working Days 22 18 21 21 22 20 Month January February March April May June Cost Information: Inventory carrying cost Demand per Day 41 39 38 57 68 55 $5 per unit per month Subcontracting cost per unit Average pay rate Overtime pay rate Labor-hours to produce a unit Cost of Increasing daily production rate (hiring and training) Cost of decreasing daily production rate (layoffs) Question: a) The plan 1 (constant workforce). $10 per unit $5 per hour ($45 /day) $7 per hour (above 8 hours per day) 1.6 hours per unit $300 per unit $600 per unit The production 50 units per day. How much total units of inventory carried over from one month to the next? If the workforce required to produce 50 units per day = 10, how much the total costs? b) The Plan 2 (subcontracting). If minmimum requirement = 38 units per day. How much in-house production? and how much the subcontracting units? How is the total costs (regular and subcontracting)? c) The plan 3 (firing and hiring). Calculate the Basic Production cost, extra cost of increasing production (hiring cost), extra cost of decreasing production (layoff cost) and the total costs (for each month). And compare the three plans, which plan has a lowest cost option?
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ANSWER 4a The plan 1 constant workforce The production 50 units per day How much total units of inventory carried over from one month to the next If the workforce required to produce 50 units per day ... View the full answer
Related Book For
Managerial Accounting for Managers
ISBN: 978-0073527130
2nd edition
Authors: Eric Noreen, Peter Brewer, Ray Garrison
Posted Date:
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