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motorcycle manufacturer is determining its production schedule for the next 6 months. The cost of manufacturing a motorcycle during each month is provided on the

motorcycle manufacturer is determining its production schedule for the next 6 months. The cost of manufacturing a motorcycle during each month is provided on the worksheet Q7. At the end of each month, a holding cost of $200 per motorcycle left in inventory is incurred. No more than 50 motorcycles can be stored in inventory at any point in time. Monthly demands for motorcycles are also given on the worksheet. Assume that at the beginning of the first month, 25 completed motorcycles are in inventory. Also, this company can produce up to 200 motorcycles per month. Finally, each unit on hand at the end of month 6 (after demand is met) could be sold for $1000. Determine a cost-minimizing production schedule that meets all demands on time by Solver on excel.

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
Unit production costs $750 $755 $785 $810 $815 $825
Unit holding cost per month
Monthly production capacity
Inventory storage capacity
Initial inventory of Month 1
Salvage value of each leftover unit (end of month 6)
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
Production level during month
Onhand Inventory after Production
Demand during month 180 205 195 196 199 208
Ending Inventory
Total monthly production cost
Total monthly inventory holding cost
Total monthly net cost

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