Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The operations manager for Element brand skateboards is preparing an aggregate plan for the next six months with the goal of meeting demand during this
The operations manager for Element brand skateboards is preparing an aggregate plan for the next six months with the goal of meeting demand during this period. They have gathered the following data to determine the costs of the plan. If they decide to use a chase production strategy, the hiring/firing cost for March is: Forecast Costs and other data Month Demand Previous output level (skateboards) 5,000 Jan 2,000 Beginning inventory (units) 0 Feb 2,000 Stockout cost (per skateboard) $5.00 Mar 3,000 Inventory holding costs (per skateboard/month) $1.00 Apr 4,000 Unit cost, regular time (per skateboard) $30 May 5,000 Subcontracting (per skateboard) $36 Jun 2,000 Hours per employee per day 8 Days per month 20 Labor standard (hours/ skateboard) 3 Cost of hiring workers (per skateboard) $3.75 Cost of firing workers (per skateboard) $9.25 $3,750 hiring, $0 firing $11,250 hiring, $0 firing $0 hiring, $0 firing
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started