Question

Develop a production plan and calculate the annual cost for a firm whose demand forecast is fall, 10,000; winter, 8,000; spring, 7,000; summer, 12,000. Inventory at the beginning of fall is 500 units.

Answer 1

Answer: Hello your question is incomplete attached below is the complete question

answer :

production plan ( attached below )

Total annual cost = $416,600

Step-by-step explanation:

Given data of the question:

Demand forecast

Fall = 10,000 , winter = 8,000 , spring = 7,000, summer = 12,000 .

Number of workers = 30, Cost of hiring = $100,

The beginning inventory = 500, Laying cost = $200,

Inventory holding cost = $5/unit, backorder cost = $10/unit, Straight time cost = $5/hr , Overtime cost = $8/hour, productivity = 0.5 unit/worker hours

season days = 6

number of units produced by a(1) worker in 1 season = 0.5 * 8 * 60 = 240unit

∴ number of units produced by 30 workers = 240 * 6 = 7200 units

use the given data to develop a production plan using excel worksheet.

Production plan of firm ( attached below )

Total Annual cost =SUM( G12:G17 ) = ( 2000 + 4000 + 2000 + 23000 + 336,000 + 49600 ) = $416,600