Forecast Data is given within problem. Cost Data is attached Southeast Soda Pop, Inc., has a new fruit drink for which it has high hopes. John Mittenthal, the production planner, has assembled the following cost data and demand forecast: LOADING...Click the icon to view the demand forecast.LOADING...Click the icon to view the cost data. John's job is to develop an aggregate plan. The three initial options he wants to evaluate are: • Plan A: a strategy that hires and fires personnel as necessary to meet the forecast. • Plan B: a level strategy. • Plan C: a level strategy that produces 1,000 cases per quarter and meets the forecast demand with inventory and subcontracting.Part 2a) Which strategy is the lowest-cost plan? Try hiring and layoffs (to meet the forecast) as necessary (enter your responses as whole numbers). Hiring and Layoff Plan QuarterForecastProductionHire(Units)Layoff(Units) 1,300 11,700enter your response hereenter your response hereenter your response herePart 3 Part 4 Part 5 Part 6The total cost, including normal time labor costs, for this hiring and layoffs plan is $ enter your response here(enter your response as a whole number).Part 7Construct a plan that holds employment steady (level strategy) by producing the average forecast for all four quarters (enter your responses as whole numbers). Part 8 Part 9 Part 10 Part 11The total cost, including normal time labor costs, for this level plan is $ enter your response here(enter your response as a whole number).Part 12Construct the level plan that holds employment steady at 1,000 plus subcontracting (enter your responses as whole numbers). Part 13 Part 14 Part 15 Part 16The total cost, including normal time labor costs, for this level plan is $ enter your response here(enter your response as a whole number).Part 17b) If you are John's boss, the VP for operations, which plan do you implement and why? A.Plan C, as it is the lowest cost and provides steady employment for the employees. B.Plan A, as it is the highest cost and provides steady employment for the employees. C.Plan B, as it is the highest cost and provides steady employment for the employees. D.Plan C, as it is the lowest cost and provides unsteady employment for the employees. E.Plan B, as it is the lowest cost and provides steady employment for the employees. F.Plan A, as it is the highest cost and provides unsteady employment for the employees. **Demand Forecast and Cost Data Analysis for Southeast Soda Pop, Inc.**Southeast Soda Pop, Inc., is launching a new fruit drink with high expectations. John Mittenthal, the production planner, has compiled the following data for demand forecasts and associated costs.John's objective is to develop an aggregate plan to determine the most cost-effective production strategy. The three initial strategies to be evaluated are:- **Plan A:** A strategy that involves hiring and laying off personnel as necessary to meet the forecast.- **Plan B:** A level strategy maintaining a steady rate of production.- **Plan C:** A similar level strategy that produces 1,000 cases per quarter and meets the forecast demand through inventory adjustments and subcontracting.### Evaluation Tasks:1. **Identify the Lowest Cost Plan:** Determine which strategy has the lowest total cost by calculating costs associated with hiring, layoffs, inventory, and subcontracting.2. **Cost Calculations for Strategies:** - **Plan A:** Calculate total costs including hiring and layoffs. - **Plan B:** Calculate total costs while maintaining steady employment to match the average forecast for all four quarters. - **Plan C:** Calculate total costs while maintaining steady employment at 1,000 units produced per quarter and meet forecast demands through inventory and subcontracting.3. **Implementation Decision:** Based on cost and employment stability, decide which plan to implement and justify the decision.### Data for Analysis:#### 1. Demand Forecast and Hiring/Layoff Plan:This section involves adjusting the production each quarter to match the demand forecast.- **Quarter 1:** Forecast of 1,700 units, production of 1,300 units- **Quarter 2:** Forecast of 1,100 units- **Quarter 3:** Forecast of 1,500 units- **Quarter 4:** Forecast of 1,000 unitsTables are provided to fill in the necessary units to hire or lay off each quarter to meet the forecasted production.#### 2. Level Plan (Average Forecast):Maintain steady production to match the average forecast demand over the four quarters.- **Quarterly Average Forecast:** [(1,700 + 1,100 + 1,500 + 1,000) / 4] unitsTables are provided to manage ending inventory/shortage and hiring/layoff for each quarter.#### 3. Level Plan (Steady 1,000 Units Production and Sub ### More Info#### Costs/Other Data- **Previous quarter's output:** 1,300 cases- **Beginning inventory:** 0 cases- **Stockout cost of backorders:** $140 per case- **Inventory holding cost:** $40 per case at end of quarter- **Hiring employees:** $35 per case- **Terminating employees:** $80 per case- **Subcontracting cost:** $70 per case- **Unit cost on regular time:** $25 per case- **Overtime cost:** $10 extra per case- **Capacity on regular time:** 1,700 cases per quarter---### Explanation:This table provides detailed information on various costs and capacity data relevant to business operations for a quarter. It includes information on previous output, costs related to inventory and employee management, and production capacities and costs. This information is useful for calculating production costs, planning inventory, and workforce management. - **Previous quarter's output** informs the historical production volume.- **Beginning inventory** indicates how many units are in stock at the start of the quarter.- **Stockout cost of backorders** is the cost associated with not meeting demand and having to backorder products.- **Inventory holding cost** refers to the expense of keeping unsold goods.- **Hiring and terminating employees costs** relate to the expenses incurred from adjusting the workforce.- **Subcontracting cost** represents the expense of outsourcing production.- **Unit cost on regular time** is the standard production cost per case.- **Overtime cost** specifies the additional expense incurred when producing beyond regularworking capacity.- **Capacity on regular time** denotes the maximum production capacity without incurring overtime. This data is vital for making informed operational and financial decisions.

Southeast Soda Pop, Inc., has a new fruit drink for which it has high hopes. John Mittenthal, the production planner, has assembled the following cost data and demand forecast: LOADING... Click the icon to view the demand forecast. LOADING... Click the icon to view the cost data. John's job is to develop an aggregate plan. The three initial options he wants to evaluate are: • Plan A: a strategy that hires and fires personnel as necessary to meet the forecast. • Plan B: a level strategy. • Plan C: a level strategy that produces 1,000 cases per quarter and meets the forecast demand with inventory and subcontracting. Part 2 a) Which strategy is the lowest-cost plan? Try hiring and layoffs (to meet the forecast) as necessary (enter your responses as whole numbers). Hiring and Layoff Plan Quarter Forecast Production Hire (Units) Layoff (Units) 1,300 1 1,700 enter your response here enter your response here enter your response here Part 3 Part 4 Part 5 Part 6 The total cost, including normal time labor costs, for this hiring and layoffs plan is $ enter your response here (enter your response as a whole number). Part 7 Construct a plan that holds employment steady (level strategy) by producing the average forecast for all four quarters (enter your responses as whole numbers). Part 8 Part 9 Part 10 Part 11 The total cost, including normal time labor costs, for this level plan is $ enter your response here (enter your response as a whole number). Part 12 Construct the level plan that holds employment steady at 1,000 plus subcontracting (enter your responses as whole numbers). Part 13 Part 14 Part 15 Part 16 The total cost, including normal time labor costs, for this level plan is $ enter your response here (enter your response as a whole number). Part 17 b) If you are John's boss, the VP for operations, which plan do you implement and why? A. Plan C, as it is the lowest cost and provides steady employment for the employees. B. Plan A, as it is the highest cost and provides steady employment for the employees. C. Plan B, as it is the highest cost and provides steady employment for the employees. D. Plan C, as it is the lowest cost and provides unsteady employment for the employees. E. Plan B, as it is the lowest cost and provides steady employment for the employees. F. Plan A, as it is the highest cost and provides unsteady employment for the employees.

Southeast Soda Pop, Inc., has a new fruit drink for which it has high hopes. John Mittenthal, the production planner, has assembled the following cost data and demand forecast: LOADING... Click the icon to view the demand forecast. LOADING... Click the icon to view the cost data. John's job is to develop an aggregate plan. The three initial options he wants to evaluate are: • Plan A: a strategy that hires and fires personnel as necessary to meet the forecast. • Plan B: a level strategy. • Plan C: a level strategy that produces 1,000 cases per quarter and meets the forecast demand with inventory and subcontracting. Part 2 a) Which strategy is the lowest-cost plan? Try hiring and layoffs (to meet the forecast) as necessary (enter your responses as whole numbers). Hiring and Layoff Plan Quarter Forecast Production Hire (Units) Layoff (Units) 1,300 1 1,700 enter your response here enter your response here enter your response here Part 3 Part 4 Part 5 Part 6 The total cost, including normal time labor costs, for this hiring and layoffs plan is $ enter your response here (enter your response as a whole number). Part 7 Construct a plan that holds employment steady (level strategy) by producing the average forecast for all four quarters (enter your responses as whole numbers). Part 8 Part 9 Part 10 Part 11 The total cost, including normal time labor costs, for this level plan is $ enter your response here (enter your response as a whole number). Part 12 Construct the level plan that holds employment steady at 1,000 plus subcontracting (enter your responses as whole numbers). Part 13 Part 14 Part 15 Part 16 The total cost, including normal time labor costs, for this level plan is $ enter your response here (enter your response as a whole number). Part 17 b) If you are John's boss, the VP for operations, which plan do you implement and why? A. Plan C, as it is the lowest cost and provides steady employment for the employees. B. Plan A, as it is the highest cost and provides steady employment for the employees. C. Plan B, as it is the highest cost and provides steady employment for the employees. D. Plan C, as it is the lowest cost and provides unsteady employment for the employees. E. Plan B, as it is the lowest cost and provides steady employment for the employees. F. Plan A, as it is the highest cost and provides unsteady employment for the employees.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Hiring and Layoff Plan
Quarter	Forecast	Production	Hire (Units)	Layoff (Units)
		1,300
1	1,700	enter your response here	enter your response here	enter your response here