Could this be answered with the excel formulas showing ABC Manufacturing is developing...
80.2K
Verified Solution
Link Copied!
Question
Accounting
Could this be answered with the excel formulas showing
ABC Manufacturing is developing their 2017 SOP. The sales plan is already developed, using the forecast obtained from Demand Management and is as follows: (the numbers are in 1000s)
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
420
375
425
600
200
100
150
250
420
390
420
450
Other problem parameters are:
Initial worker level = 500, Initial inventory = 100,000, Required ending inventory = 100,000, Cost per unit = $50, one worker can produce 600 units/month
Hiring cost = $150 per worker, Firing cost = $300 per worker, Inventory holding cost = 0.5% of item cost/month, Shortage cost = 1% of item cost/month.
1.) Develop a Chase plan
2.) Develop a Level plan
For each plan, calculate the end of month inventory (or shortage) level, monthly hiring and firing schedule and costs, monthly inventory and shortage costs, and the total cost.
3.) By trial and error, come up with a mix strategy that will have less total cost than any of the above two.
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
