EXACT DEMAND

february march costs

Production Requirement
80000 64000

Production Hours
Requirement ( Production
Requirement * 1h/4 unit)
20000 16000

Workdays

20 20

Hours by month per worker

(workdays * 8hours/day)
160 160

Requirement of workers
(Production hours / hours
by month per worker)
125 100

Hired Workers (100)

25 0
Hired Costs (Hired workers
* $50) $1,250.00 $0 $1,250.00

Fired Workers
0 25

Costs of Fired Workers

(Fired Workers * $70)
$0 1750 $1,750.00
Costs of Normal Time
(Production Hours
Requirement * $10)
200000 160000 $360,000.00

total $363,000.00
a)

february march costs

Production Requirement 96000 76800
Production Hours
Requirement ( Production
Requirement * 1h/4 unit) 24000 19200

Workdays 20 20

Hours by month per worker

(workdays * 8hours/day)
160 160
Requirement of workers
(Production hours / hours
by month per worker)
150 120

Hired Workers (100) 50 0

Hired Costs (Hired workers
* $50) $ 2,500.00 $ - $ 2,500.00

Fired Workers 0 30

Costs of Fired Workers

(Fired Workers * $70) $ - $ 2,100.00 $ 2,100.00
Costs of Normal Time
(Production Hours
Requirement * $4) $ 96,000.00 $ 76,800.00 $ 172,800.00

total $ 177,400.00
 OVERTIME AND INV WITH STABLE WORKFORCE

april may costs

Initial Inventory
0 -16000

Workdays

20 20

Available work hours (workdays

by month * 8 hours/day * 100
workers)
16000 16000

Real Production (Available work

hours / .25h/unit)
64000 64000

Demand Forecast

100000 40000

Units Available Before overtime

(Initial inventory + Real
Production - Demand Forecast)
-36000 8000

Overtime units
20000 0

Cost overtime units (Overtime

untis * 1/4h * $15/h)
$ 75,000.00 $ - $ 75,000.00
Excess Units (Units before
overtime - Safety inventory) (only
if is possitive)
0 8000

Cost of inventory (Excess Units *

$10)
$ - $ 80,000.00 $ 80,000.00
Cost of Regular Time (Available
work hours * $4) $ 160,000.00 $ 160,000.00 $ 320,000.00

Cost of Delayed ($20p/unit)

$ 320,000.00 $ - $ 320,000.00

total $ 795,000.00
 april may costs
Initial Inventory 0 -23200

Workdays 20 20
Available work hours (workdays
by month * 8 hours/day * 150
workers) 19200 19200

Real Production (Available work

hours / .25h/unit) 76800 76800

Demand Forecast 120000 48000

Units Available Before overtime

(Initial inventory + Real
Production - Demand Forecast) -43200 5600

Overtime units 20000 0

Cost overtime units (Overtime
untis * 1/4h * $15/h) $ 75,000.00 $ - $ 75,000.00
Excess Units (Units before
overtime - Safety inventory) (only
if is possitive) 0 5600

Cost of inventory (Excess Units *

$10) $ - $ 56,000.00 $ 56,000.00
Cost of Regular Time (Available
work hours * $4) $ 76,800.00 $ 76,800.00 $ 153,600.00
orders delayed 23200 0
Cost of Delayed ($20p/unit) $ 464,000.00 $ - $ 464,000.00
total $ 748,600.00
TOTAL COST $1,158,000.00
TOTAL $ 926,000.00
 Demand and Work days
Januray February
Demand 1000 1500
Work days 22 19

Produccion Requirement
January February
Initial Inventory 500 500
Demand Forecast 1000 1500

Safety Inventory (0.5*Demand

500 750
Forecast)

Production Requirement
(Forecast Demand + Safety 1000 1750
Inventory - Initial Inventory)

Final Inventory (Initial Inventory

+ Production Requirement - 500 750
Forecast Demand)

January February
Production Requirement 1000 1750
Production Hours Requirement
( Production Requirement * 10000 17500
1h/0.1 unit)
Workdays 22 19
Hours by month per worker
176 152
(workdays * 8hours/day)
Requirement of workers
(Production hours / hours by 57 116
month per worker)
Hired Workers 7 59
Hired Costs (Hired workers *
$1,400 $11,800
$200)
Fired Workers 0 0
Costs of Fired Workers (Fired
$0 $0
Workers * $300)
Costs of Normal Time
(Production Hours Requirement $60,000 $105,000
* $6)
cost of manufacturing $ 200,000.00 $ 350,000.00
emand and Work days
March total
1200 3700
21 62

on Requirement
March
750
1200

600

1050

600

March costs
1050

10500

21
168

63

0
$0
$13,200
53
$15,900
$15,900

$63,000
$228,000
$ 210,000.00 $760,000
$1,017,100
 January February March
Initial Inventory 200.000 180.800 -38.400

Workdays 22 22 22

Available work hours

(workdays by month *
5808.000 5808.000 5808.000
8 hours/day * 33
workers)

Real Production
(Available work 580.800 580.800 580.800
hours /10h/unit)

Demand Forecast 600 800 900

Final Inventory (Initial
Inventory + real
180.800 -38.400 -357.600
production - demand
forecast)

Cost of missing pieces

$ - $ 768.00 $ 7,152.00
(missing units * $20)

Safety Inventory

Excess units (Final

Inventory - Safety
180.800 0.000 0.000
Inventory) If quantity
is positive

Cost of Excess
inventory (Excess $ 904.00 $ - $ -
inventory * $/unit)

Costs of
manufcaturing
$ 116,160.00 $ 116,160.00 $ 116,160.00
(Production Hours
Requirement * $200)

Workers
Production
Requirement *
33.63453815261
10h/unit / workdays *
8h/day
 Plan 2: Expected average Demand, maintain workforce
April May June July August
-357.600 -376.800 -196.000 84.800 69.600

22 22 22 7 22

5808.000 5808.000 5808.000 1848.000 5808.000

580.800 580.800 580.800 184.800 580.800

600 400 300 200 200

-376.800 -196.000 84.800 69.600 450.400

$ 7,536.00 $ 3,920.00 $ - $ - $ -

0.000 0.000 84.800 69.600 450.400

$ - $ - $ 424.00 $ 348.00 $ 2,252.00

$ 116,160.00 $ 116,160.00 $ 116,160.00 $ 36,960.00 $ 116,160.00

force
September October November December
450.400 731.200 612.000 392.800

22 22 22 22

5808.000 5808.000 5808.000 5808.000

580.800 580.800 580.800 580.800

300 700 800 900

731.200 612.000 392.800 73.600

$ - $ - $ - $ -
$ 19,376.00

731.200 612.000 392.800 73.600

$ 3,656.00 $ 3,060.00 $ 1,964.00 $ 368.00

$ 12,976.00

$ 116,160.00 $ 116,160.00 $ 116,160.00 $ 116,160.00

$ 1,314,720.00

$ 1,347,072.00
 Fall Winter Spring
Demand 10000 8000 7000
Workdays 60 60 60

Production requirement

Produccion Requirement
Fall Winter Spring
Initial Inventory 500 -2300 0
Demand Forecast 10000 8000 7000
Safety Inventory
0 0 0
(0.0*Demand Forecast)

Production Requirement
(Forecast Demand + Safety 9500 10300 7000
Inventory - Initial Inventory)

Final Inventory (Initial

Inventory + Production
0 0 0
Requirement - Forecast
Demand)

Fall Winter Spring

Initial Inventory 500 -2300 0

Production Requirement 9500 10300 7000
Production Hours
requirement (production
requirement*2h/unit) 19000 20600 14000
Workdays 60 60 60

Hours by month per worker 480 480 480

Requirement of workers
(production hours/hours by
month per worker) 40 43 30
Available work hours
(workdays by month
*8hours/day*30workers 14400 14400 14400

Real production (available

work hours / 2h/unit) 7200 7200 7200

Hired workers (initial is 30) 0 0 0

Hired costs ($100) $ - $ - $ -
Fired workers 0 0 0
Costs of fired workers
($200) $ - $ - $ -

Overtime hours 0 6200 0

Cost of Overtime hours
($8) $ - $ 49,600.00 $ -
Final Inventory (Initial
inventory+real production -
demand forecast) -2300 0 200
Cost of inventory (final inv
*$5) (positive) $ - $ - $ 1,000.00
Cost of backorders (final
inv *$10) (negative) $ 23,000.00 $ - $ -
Cost of regular time
(availabel work hours* 5) $ 72,000.00 $ 72,000.00 $ 72,000.00
 Summer Total
12000 37000
60 240

irement
Summer
200
12000
0

11800

Summer

200
11800

23600
60

480

50

24000

12000

20
$ 2,000.00 $ 2,000.00
20

$ 4,000.00 $ 4,000.00

0
$ - $ 49,600.00

200

$ 1,000.00 $ 2,000.00

$ - $ 23,000.00

$ 120,000.00 $ 336,000.00

total cost $ 416,600.00