The average requirements (average daily demand) is For Plan 1: The monthly inventory change in February is The monthly inventory change in May is The ending inventory in March is The total inventory carrying cost is $. The total cost is $_ For Plan 2: Chick-fil-A needs to hire The production rate is The total in-house production is The total subcontracting cost is $. The total cost is $_ For plan 3: The total hiring cost is $ The total layoff cost is $ The total cost is $ Plan is the best plan. units. ___ units/day. units. units. workers to maintain the workforce. units/day. __units.

Marketing
20th Edition
ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
Section: Chapter Questions
Problem 6DRQ
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Chick-fil-A is preparing its aggregate plan for the first six months of 2023. The tables below contain the monthly demand
forecast, working days per month, and cost information.
Month
Expected Demand
Production Days
January
February
March
April
May
June
180
160
220
150
250
240
Inventory carrying cost
Cost of decreasing daily production rate
(layoffs)
20
For Plan 2:
Chick-fil-A needs to hire
The production rate is
The total in-house production is
The total subcontracting cost is $
The total cost is $
20
15 per unit per
month
Subcontracting cost per unit
30 per unit
Regular working hours per day
8 hours
Labor-hours to produce a unit
2 hours/unit
Average pay rate
10 per hour
Overtime pay rate
15 per hour
Cost of increasing daily production rate (hiring 150 per unit
and training)
For plan 3:
The total hiring cost is $
The total layoff cost is $
The total cost is $_
Plan
10
is the best plan.
10
25
15
The company is considering the following three strategies:
Plan 1: A constant workforce, daily production rate = average requirements
Plan 2: Main a constant workforce at a necessary level to meet the lowest demand month, and to meet all demand above
this level by subcontracting.
Plan 3: Hire and layoff workers as needed to produce exact requirements.
Please answer the following questions: (hint: all numbers are integer, no decimal places are needed)
The average requirements (average daily demand) is_____________ units/day.
For Plan 1:
The monthly inventory change in February is
The monthly inventory change in May is
The ending inventory in March is
The total inventory carrying cost is $_
The total cost is $_
200 per unit
units.
units.
units.
workers to maintain the workforce.
units/day.
_units.
Transcribed Image Text:Chick-fil-A is preparing its aggregate plan for the first six months of 2023. The tables below contain the monthly demand forecast, working days per month, and cost information. Month Expected Demand Production Days January February March April May June 180 160 220 150 250 240 Inventory carrying cost Cost of decreasing daily production rate (layoffs) 20 For Plan 2: Chick-fil-A needs to hire The production rate is The total in-house production is The total subcontracting cost is $ The total cost is $ 20 15 per unit per month Subcontracting cost per unit 30 per unit Regular working hours per day 8 hours Labor-hours to produce a unit 2 hours/unit Average pay rate 10 per hour Overtime pay rate 15 per hour Cost of increasing daily production rate (hiring 150 per unit and training) For plan 3: The total hiring cost is $ The total layoff cost is $ The total cost is $_ Plan 10 is the best plan. 10 25 15 The company is considering the following three strategies: Plan 1: A constant workforce, daily production rate = average requirements Plan 2: Main a constant workforce at a necessary level to meet the lowest demand month, and to meet all demand above this level by subcontracting. Plan 3: Hire and layoff workers as needed to produce exact requirements. Please answer the following questions: (hint: all numbers are integer, no decimal places are needed) The average requirements (average daily demand) is_____________ units/day. For Plan 1: The monthly inventory change in February is The monthly inventory change in May is The ending inventory in March is The total inventory carrying cost is $_ The total cost is $_ 200 per unit units. units. units. workers to maintain the workforce. units/day. _units.
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ISBN:
9780357033791
Author:
Pride, William M
Publisher:
South Western Educational Publishing