Wes and Steve are partners in a lunch truck company that operates a central kitchen and operates lunch trucks that travel to various locations in Philadelphia, Monday-Friday. The lunch trucks deliver pre-packaged healthy sandwich and salad alternatives, fresh fruit and pre-packaged low-fat desserts and canned beverages. Together, the partners have to make many decisions about how to structure the operational aspects of the business so that it is cost effective, efficient and profitable. Current Situation: Wes and Steve have begun to sell their bottled hot sauce to area markets. They have prepared a forecast of expected demand for the bottles for the next 6 periods as shown below. Given this information and the data re: capacities and costs, complete the 2 required aggregate plans on the next pages and answer the Qs shown. Maximum regular production =250 units / period Maximum overtime =25 units / period Maximum Subcontracting =500/ period Beginning inventory =0 Regular time cost =$12 Overtime cost =$18 Sub-contract cost =$25 Inventory holding costs are \$1/average unit/period Backorders cost of $20/ unit/period Important Notes: - You must write neatly and NOT in red ink. - You are not permitted to cross out answers; use white-out or start over. - If I cannot read your work, you will receive zero points. - CARRY THROUGH ERRORS COUNT and points will be deducted! Double check your work. Instructions: Print this and next page, reproduce by hand or complete via computer. Complete each of the plans and provide answers on the next page on the line provided ONLY. When completed: Take a photo of THIS AND NEXT PAGE ONLY save file and upload via the corresponding Assignment link in Canvas by the due date. Remember: No . HElC files are permitted. LEVEL PLAN (5 nts) Continue to Next Page CHASE PLAN ( 5 pts) 1. Which plan is better from a cost standpoint? (1 pt) 2. Which plan is better for employees? Why? (2pt) 3. For both plans, might quality be jeopardized? Why? (1pt) 4. If dernand was to increase over time, what STRATEGIC action must Wes and Steve undertake to ensure profitability, cost effectiveness and quality for their business? (FY) - there is only one correct answer to this Q) Wes and Steve are partners in a lunch truck company that operates a central kitchen and operates lunch trucks that travel to various locations in Philadelphia, Monday-Friday. The lunch trucks deliver pre-packaged healthy sandwich and salad alternatives, fresh fruit and pre-packaged low-fat desserts and canned beverages. Together, the partners have to make many decisions about how to structure the operational aspects of the business so that it is cost effective, efficient and profitable. Current Situation: Wes and Steve have begun to sell their bottled hot sauce to area markets. They have prepared a forecast of expected demand for the bottles for the next 6 periods as shown below. Given this information and the data re: capacities and costs, complete the 2 required aggregate plans on the next pages and answer the Qs shown. Maximum regular production =250 units / period Maximum overtime =25 units / period Maximum Subcontracting =500/ period Beginning inventory =0 Regular time cost =$12 Overtime cost =$18 Sub-contract cost =$25 Inventory holding costs are \$1/average unit/period Backorders cost of $20/ unit/period Important Notes: - You must write neatly and NOT in red ink. - You are not permitted to cross out answers; use white-out or start over. - If I cannot read your work, you will receive zero points. - CARRY THROUGH ERRORS COUNT and points will be deducted! Double check your work. Instructions: Print this and next page, reproduce by hand or complete via computer. Complete each of the plans and provide answers on the next page on the line provided ONLY. When completed: Take a photo of THIS AND NEXT PAGE ONLY save file and upload via the corresponding Assignment link in Canvas by the due date. Remember: No . HElC files are permitted. LEVEL PLAN (5 nts) Continue to Next Page CHASE PLAN ( 5 pts) 1. Which plan is better from a cost standpoint? (1 pt) 2. Which plan is better for employees? Why? (2pt) 3. For both plans, might quality be jeopardized? Why? (1pt) 4. If dernand was to increase over time, what STRATEGIC action must Wes and Steve undertake to ensure profitability, cost effectiveness and quality for their business? (FY) - there is only one correct answer to this Q)
