13.18 Jos Martinez of El Paso has developed a polished stainless steel tortilla machine that makes it

• • • 13.18 José Martinez of El Paso has developed a polished stainless steel tortilla machine that makes it a “showpiece” for display in Mexican restaurants. He needs to develop a 5-month aggregate plan. His forecast of capacity and demand follows:

Assume that backorders are not permitted. Using the transportation method, what is the total cost of the optimal plan?

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MONTH 1 2 3 4 5 Demand 150 160 130 200 210 Capacity Regular 150 150 150 150 150 Overtime 20 20 10 10 10 Subcontracting: 100 units available over the 5-month period Beginning inventory: O units Ending inventory required: 20 units COSTS Regular-time cost per unit Overtime cost per unit Subcontract cost per unit Inventory holding cost per unit per month $100 $125 $135 $ 3