70.2K

Verified Solution

Link Copied!

Helter Industries, a company that produces a line of women's bathing suits, hires temporaries to help produce its summer product demand. For the current four-month rolling schedule, there are 12 full-time employees on staff. Temps can be hired when needed and can be used as needed on a month-by-month basis, whereas the full-time employees must be paid whether they are needed or not. Each full-time employee can produce 205 suits, while each temporary employee can produce 165 suits per month.

Demand for bathing suits for the next four months is as follows:

MAY	JUNE	JULY	AUGUST
3,200	2,800	3,100	3,000

Beginning inventory in May is 403 complete (a complete two-piece includes both top and bottom) bathing suits. Bathing suits cost $40 to produce and carrying cost is 24 percent per year.

Develop an aggregate plan that uses the 12 full-time employees each month and a minimum number of temporary employees. Assume that all employees will produce at their full potential each month. Calculate the inventory carrying cost associated with your plan using planned end of month levels. (Round "Inventory cost" to 2 decimal places.)

	May	June	July	August
Forecast	3,200	2,800	3,100	3,000
Beginning inventory
Production required
Regular workforce
Regular production
Temp workforce
Temp production
Total production
Ending inventory
Inventory cost	$	$	$	$
				$

Answer & Explanation Solved by verified expert

See Answer