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The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: January 1,500 May 2,300 February
The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: January 1,500 May 2,300 February 1,700 June 2,100 March 1,700 July 1,900 April 1,700 August 1,500 Her operations manager is considering a new plan, which begins in January with 200 units of inventory on hand. Stockout cost of lost sales is $100 per unit. Inventory holding cost is $25 per unit per month. Ignore any idletime costs. The plan is called plan C. Plan C: Keep a stable workforce by maintaining a constant production rate equal to the average gross requirements excluding initial inventory and allow varying inventory levels. Conduct your analysis for January through August. The average monthly demand requirement = :l units. (Enter your response as a whole number.) In order to arrive at the costs, rst compute the ending inventory and stockout units for each month by filling in the table below (enter your responses as whole numbers). :I Ending Stockouts Period Month Demand Production Inventory (Units) 0 December 200 1 January 1,500 1,800 2 February 1,700 1,800 3 March 1,700 1,800 4 April 1,700 1,800 5 May 2,300 1,800 6 June 2, 100 1,800 7 July 1,900 1,800 8 August 1,500 1,800 The total stockout cost = $ . (Enter your response as a whole number.) The total inventory carrying cost = $ . (Enter your response as a whole number.) The total cost, excluding normal time labor costs, is = $ . (Enter your response as a whole number.)
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