Using the given information, produce an aggregate plan and determine the following. Period Forecast 1 180 2
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Question:
Using the given information, produce an aggregate plan and determine the following.
| Period | Forecast |
| 1 | 180 |
| 2 | 170 |
| 3 | 140 |
| 4 | 150 |
| 5 | 130 |
| 6 | 150 |
| Regular time: | $20 per unit (150 units per period maximum) |
| Overtime: | $30 per unit (20 units max per period maximum) |
| Subcontracting: | None available |
| Beginning Inv: | None |
| Holding cost: | $5 per unit per period |
| Backorder cost: | $20 Per unit per period |
- What is total forecasted demand?
- What is total regular time capacity?
- How should overtime capacity be utilized?
- What are total regular time costs?
- What are total overtime costs?
- What are total carrying costs?
- What are total backorder costs?
- What are total costs for each period?
- What are total costs for the six periods?
- If hiring cost is $500 and firing cost if $400, would it be more economical on a per unit basis to use overtime or to hire and fire a temporary person (who can produce a maximum of 30 units per period)? What would be the difference in total costs for the six periods?
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