BBA Inc. assembles lawn mowers and snow blowers from subassemblies and component parts provided by reliable vendors. Bot

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: Bba Inc Assembles Lawn Mowers And Snow Blowers From Subassemblies And Component Parts Provided By Reliable Vendors Bot 1 (30.98 KiB) Viewed 25 times

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BBA Inc. assembles lawn mowers and snow blowers from subassemblies and component parts provided by reliable vendors. Both products (end items) utilize the same small engines, many of the same parts and require employee labor skills On December 20, the Production Planning Commitee of BBA Inc. is due to adopt an aggregate plan for the year. The available planning information is as follow: Information: Demand Forecasts (cu) Lawnmowers Snowblowers 10,000 9,000 11 15,000 7,000 |||| 21,000 23,500 IV 3,000 10,000 Quarter I BI: Mowers 1600 cu Blowers 400 cu Output and Costs Regular Time - $ 5.00 per cu Overtime -$7.50 per cu Subcontract -$10.00 per cu Part Time -$12.00 per cu Inventory -$1.00 per cu per quarter based on avg, inventory during each quarter Back orders $8.00 per cu per period (based on back orders at end of period) $200.00 per emploves (Eull-Time or Part Time) Quarter 1
Back orders- $ 8.00 per cu per period (based on back orders at end of period) Hiring - $200.00 per employee (Full-Time or Part-Time) Firing -$500.00 per employee (no cost if Part-Time) Production Rates: Regular - 500 cus per Full-Time employee per quarter (of either unit) 200 cus per Full-Time employee per quarter (of either unit) Part Time 400 cus per Part-Time employee per quarter (of either unit). Overtime Up to 25 workers/qtr. Subcontract - Up to 5000 cus/qtr Initial regular work force size: 34 Full-Time employee (beginning of Qtr. 1) Maximum regular work force size during the planning period: 44 Full-time Employee Additional Assumptions 1) Part-Time employees may not work overtime. 2) Assume 100% utilization of employees at all times, i.e. all employees on the payroll during a period produce at the rates shown above. On Dec. 22 the V.P. Finance informs you that the cost of capital will be extremely high next year. As a consequence he asks you to develop an aggregate plan based on a "Chase" strategy as closely as nocsible Fading and of anal
period produce at the rates shown above. On Dec. 22 the V.P. Finance informs you that the cost of capital will be extremely high next year. As a consequence he asks you to develop an aggregate plan based on a "Chase" strategy as closely as possible. Ending inventory or back order is to be as close to zero as possible at the end of each quarter. The V.P. Manufacturing says he realized this type of strategy will require him to abandon his beloved "level" strategy and for you to vary the total output rate from one quarter to another. When necessary to do so, the following options and priorities should be used in developing the required output each period. Priority Option 1 Full-Time Employees (FTE) up to the limit 2 Overtime (FTE)I 3 Subcontract 4 Part-time Using the APP form used in class, show your calculations of the plan and the relevant costs.