Question

Given the projected demands for the next six months, prepare an aggregate plan that uses inventory, regular time, overtime, subcontract and backorders. Regular time is limited to 170 units per month (Cost per Unit = $40 ). Overtime is limited to a maximum of 20 units per month (Cost per Unit =$60). Units purchased from the subcontractor (Cost per Unit = $72 ) cannot exceed 30 per month and the total purchases from the subcontractor over the 6 month period cannot be over 270 units. Backorders cannot exceed 60 units in any given month (Cost per Unit = $1 ) and must be no more than 0 in Period 6. Average Inventory Holding cost per Unit = $4. Forecasted Demand as well as Beginning and desired Ending Inventory are listed in the table below.

Month	1	2	3	4	5	6	Total
Regular Output
Overtime Output
Subcontract
Beginning Inventory	30
Total Available for Sale
Less Forecast	200	210	310	160	140	150
Plus Backlog-Current Period
Less Backlog-Previous Period
Ending Inventory						0
Average Inventory

Required:
Find the Minimum Cost Production Plan by Creating a Spreadsheet in Excel. Use Solver to find the Minimum Cost Solution. Leave a copy of your Spreadsheet in the DropBox.

Total Cost Month 1 =

Hint: Range (8070 ,8170 )
Total Cost Month 2 =

Hint: Range (10230 ,10360 )
Total Cost Month 3 =

Total Cost Month 4 =

Total Cost Month 5 =

Hint: Range (6750 ,6910 )
Total Cost Month 6 =

Total Cost All Periods =

Hint: Range (48610 ,50010 )
Answer Format: No Dollar ($) signs or commas --- Answers should be whole numbers

Answer 1

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