Manager Chris Channing Of Fabric Mills Inc Has Developed The Forecast Shown In The Table For Bolts Of Cloth The Figu 1 (38.7 KiB) Viewed 13 times
Manager Chris Channing of Fabric Mills, Inc., has developed the forecast shown in the table for bolts of cloth. The figures are in hundreds of bolts. The department has a regular output capacity of 195(00) bolts per month, except for the seventh month, when capacity will be 210(00) bolts. Regular output has a cost of $9 per hundred bolts. Workers can be assigned to other jobs if production is less than regular. The beginning inventory is zero bolts. 4 194 Month Forecast Period Forecast Output 1 200 Regular Overtime Output - Forecast Cost Regular Overtime Total 189 a. Develop a chase plan that matches the forecast and compute the total cost of your plan. Overtime is $19 per hundred bolts. Regular production can be less than regular capacity. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required.) 3 210 1 200 2 5 212 189 3 6 195 210 7 215 194 Total 1,415 5 212 6 195 7 215 Total 1,415
b. Would the total cost be less with full regular production each period with no overtime, but using a subcontractor to handle the excess above regular capacity at a cost of $23 per hundred bolts? Backlogs are not allowed. The inventory carrying cost is $2 per hundred bolts. (Round your Average inventory values to 1 decimal place. Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required.) Period Forecast Output Regular Subcontracting Inventory Beginning Ending Average Cost Regular Subcontracting Inventory Total 1 200 2 189 3 210 4 194 5 212 6 195 7 215 Total 1.415
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