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ANSWER 1. A fim must ship a 10 lb parcel of 30 QUESTION 1. 10 lb parcel of 30 items worth $500 using GROUND 10 lb parcel of 30 items worth $500 using AIR How should the firm ship their products? 2. 50 items weighing 5 lbs worth $500 using SHIPPER A 50 items weighing 5 lbs worth $500 using SHIPPERB Which is the lowest cost option (Shipper A or B) 3A. Total cost for CHASE with LEVEL WORKFORCE and OVERTIME 3B. Total cost for CHASE with HIRING AND FIRING 3C. Total cost for LEVEL with OVERTIME SUBCONTRACTING 3D. Total cost for LEVEL with BACKORDERS 3E. Which of the 4 plans would you support and why? 3F. How could labor markets, marketing decisions, and/or financial constraints impact your choice of preferred plan? Total cost - In-transit holding cost + Freight cost In-transir holding = days in transit/365 x value x holding cost 1. A firm must ship a 10 lb parcel of 30 items valued at $500 each a distance of 1,000 miles. Transportation options are 8-day ground at a cost of $50 or 2-day air at a cost of $90. In-transit holding cost is 20% of product value. How should the firm ship their products? 2. A company needs to ship 50 items weighing 5 lbs each and valued at $500/item. Shipper A quoted a total cost of $500 for delivery in 5 days. Shipper B quoted $600 for delivery in 2 days. If the annual carrying cost is 25%, which is lowest cost option? The Dryski Snow Ski Company is the world's second largest producer of snow skis. As you might suspect, snow skis exhibit a highly seasonal demand pattern with peaks during the winter months and valleys during the summer months, Quarter Sale Forecast Inventory carrying cost $3 per pair of skis per quarter 1 125,000 Production per employee 1.000 pairs of skis per quarter 2 75,000 Regular workforce 90 workers 3 60,000 Overtime capacity soo pairs of skis per gtr per worker 4 180,000 Subcontracting capacity 40.000 pairs of skis Cost of regular production $50 per pair of skis A. The CEO of Dryski Snow Skl has decided Cost of overtime production $75 per pair of skis Cost of subcontracted production $100 per pair of skis to enforce the company's policy of guaranteed Backorder cost $20 per of skis per quarter employment. Determine a chase production Safety Stock Inventory 100 pairs of skis on hand plan that utilizes a stable workforce (of 90 employees) and calculate the total cost of the plan. CHASE with LEVEL WORKFORCE and OVERTIME Quarter Sales Forecast Prod Plan Inventory Workers needed Hire Fire Overtime Subcontract 1 125,000 2 75,000 3 60,000 4 180,000 Total 440,000 B. The CFO of Dryski Snow Ski wants to calculate the cost of NOT guaranteeing employment. Assume the cost of hiring and firing workers is $300 per worker hired and $800 per worker fired and calculate the total cost of the plan. Which plan would you support and why? CHASE with HIRING AND FIRING Quarter Sales Forecast Prod Plan Inventory Overtime Workers needed Hire Fire Subcontract 125,000 2 75,000 60,000 180,000 The Dryski Snow Ski Company is the world's second largest producer of snow skis. As you might suspect, snow skis exhibit a highly seasonal demand pattern, with peaks during the winter months and valleys during the summer months Quarter Sales Forecast Inventory carrying cost 53 per pair of skis per quarter 1 125.000 Production per employee 1.000 pairs of skisper quartet 2 75,000 Regular workforce 90 workers 3 60,000 Overtime capacity 500 pairs of skis per qur per worker 4 180,000 Subcontracting capacity 40,000 pairs of skis Cost of regular production $50 per pair of skis C. The CFO of Dryski Snow Ski wants to Cost of overtime production $75 per pair of scis calculate the cost of a pure level plan - where Cost of subcontracted production S100 per pair of skis Backorder cost $20 per of skis per quarter the production needed dictates the workforce. Safety Stock Inventory 100 pairs of skis on hand Assume the cost of hiring and firing workers is $300 per worker hired and $800 per worker fired and use overtime and subcontracting) if needed. Calculate the total cost of the plan. LEVEL with OVERTIME/SUBCONTRACTING Quarter Sales Forecast Prod Plan Inventory Backorders Overtime Workers Hire Fire Subcontract needed 1 125,000 2 75.000 3 60,000 4 180,000 Total 440,000 D. The CFO of Dryski Snow Ski wants to calculate the cost of a pure level plan-where the production needed dictates the workforce. Assume the cost of hiring and firing workers is $300 per worker hired and $800 per worker fired and use backorders if needed. Calculate the total cost of the plan. LEVEL with BACKORDERS Quarter Sales Forecast Overtime Workers Prod Plan Inventory Backorders Subcontract Fire needed 125,000 Hire 2 75,000 3 60,000 4 180,000 Total 440,000 ANSWER 1. A fim must ship a 10 lb parcel of 30 QUESTION 1. 10 lb parcel of 30 items worth $500 using GROUND 10 lb parcel of 30 items worth $500 using AIR How should the firm ship their products? 2. 50 items weighing 5 lbs worth $500 using SHIPPER A 50 items weighing 5 lbs worth $500 using SHIPPERB Which is the lowest cost option (Shipper A or B) 3A. Total cost for CHASE with LEVEL WORKFORCE and OVERTIME 3B. Total cost for CHASE with HIRING AND FIRING 3C. Total cost for LEVEL with OVERTIME SUBCONTRACTING 3D. Total cost for LEVEL with BACKORDERS 3E. Which of the 4 plans would you support and why? 3F. How could labor markets, marketing decisions, and/or financial constraints impact your choice of preferred plan? Total cost - In-transit holding cost + Freight cost In-transir holding = days in transit/365 x value x holding cost 1. A firm must ship a 10 lb parcel of 30 items valued at $500 each a distance of 1,000 miles. Transportation options are 8-day ground at a cost of $50 or 2-day air at a cost of $90. In-transit holding cost is 20% of product value. How should the firm ship their products? 2. A company needs to ship 50 items weighing 5 lbs each and valued at $500/item. Shipper A quoted a total cost of $500 for delivery in 5 days. Shipper B quoted $600 for delivery in 2 days. If the annual carrying cost is 25%, which is lowest cost option? The Dryski Snow Ski Company is the world's second largest producer of snow skis. As you might suspect, snow skis exhibit a highly seasonal demand pattern with peaks during the winter months and valleys during the summer months, Quarter Sale Forecast Inventory carrying cost $3 per pair of skis per quarter 1 125,000 Production per employee 1.000 pairs of skis per quarter 2 75,000 Regular workforce 90 workers 3 60,000 Overtime capacity soo pairs of skis per gtr per worker 4 180,000 Subcontracting capacity 40.000 pairs of skis Cost of regular production $50 per pair of skis A. The CEO of Dryski Snow Skl has decided Cost of overtime production $75 per pair of skis Cost of subcontracted production $100 per pair of skis to enforce the company's policy of guaranteed Backorder cost $20 per of skis per quarter employment. Determine a chase production Safety Stock Inventory 100 pairs of skis on hand plan that utilizes a stable workforce (of 90 employees) and calculate the total cost of the plan. CHASE with LEVEL WORKFORCE and OVERTIME Quarter Sales Forecast Prod Plan Inventory Workers needed Hire Fire Overtime Subcontract 1 125,000 2 75,000 3 60,000 4 180,000 Total 440,000 B. The CFO of Dryski Snow Ski wants to calculate the cost of NOT guaranteeing employment. Assume the cost of hiring and firing workers is $300 per worker hired and $800 per worker fired and calculate the total cost of the plan. Which plan would you support and why? CHASE with HIRING AND FIRING Quarter Sales Forecast Prod Plan Inventory Overtime Workers needed Hire Fire Subcontract 125,000 2 75,000 60,000 180,000 The Dryski Snow Ski Company is the world's second largest producer of snow skis. As you might suspect, snow skis exhibit a highly seasonal demand pattern, with peaks during the winter months and valleys during the summer months Quarter Sales Forecast Inventory carrying cost 53 per pair of skis per quarter 1 125.000 Production per employee 1.000 pairs of skisper quartet 2 75,000 Regular workforce 90 workers 3 60,000 Overtime capacity 500 pairs of skis per qur per worker 4 180,000 Subcontracting capacity 40,000 pairs of skis Cost of regular production $50 per pair of skis C. The CFO of Dryski Snow Ski wants to Cost of overtime production $75 per pair of scis calculate the cost of a pure level plan - where Cost of subcontracted production S100 per pair of skis Backorder cost $20 per of skis per quarter the production needed dictates the workforce. Safety Stock Inventory 100 pairs of skis on hand Assume the cost of hiring and firing workers is $300 per worker hired and $800 per worker fired and use overtime and subcontracting) if needed. Calculate the total cost of the plan. LEVEL with OVERTIME/SUBCONTRACTING Quarter Sales Forecast Prod Plan Inventory Backorders Overtime Workers Hire Fire Subcontract needed 1 125,000 2 75.000 3 60,000 4 180,000 Total 440,000 D. The CFO of Dryski Snow Ski wants to calculate the cost of a pure level plan-where the production needed dictates the workforce. Assume the cost of hiring and firing workers is $300 per worker hired and $800 per worker fired and use backorders if needed. Calculate the total cost of the plan. LEVEL with BACKORDERS Quarter Sales Forecast Overtime Workers Prod Plan Inventory Backorders Subcontract Fire needed 125,000 Hire 2 75,000 3 60,000 4 180,000 Total 440,000