Develop a production schedule to produce the exact production requirements by va

Question

Develop a production schedule to produce the exact production requirements by varying the workforce size for the following problem.

     The monthly forecasts for Product X for January, February, and March are 1,040, 1,460, and 1,240, respectively. Safety stock policy recommends that half of the forecast for that month be defined as safety stock. There are 22 working days in January, 19 in February, and 21 in March. Beginning inventory is 540 units.

     Manufacturing cost is $190 per unit, storage cost is $3 per unit per month, standard pay rate is $7 per hour, overtime rate is $11 per hour, cost of stockout is $12 per unit per month, hiring and training cost is $260 per worker, layoff cost is $360 per worker, and worker productivity is 0.1 unit per hour. Assume that you start off with 47 workers and that they work 8 hours per day. (Leave no cells blank - be certain to enter "0" wherever required. Input all values as positive values. Round Workers Required up to next higher whole number. Round all other variables to nearest whole number.)

January February March Forecast 1,040 1,460 1,240 Safety stock Beginning inventory Net production required Workers required Hired Laid off Actual production Ending inventory

Explanation / Answer

January February March January February March Forecast 1,040 1,460 1,240 Forecast 1,040 1,460 1,240 Days 22 19 21 Safety stock 520 730 620 Safety stock 520 730 620 Beginning inventory 540 520 730 Beginning inventory 540 520 730 Net production required 1020 1670 1130 Net production required 1,020 1,670 1,130 Workers required 58 110 68 0.1 Hours 10200 16700 11300 Hired 11 52 0 ROUNDUP(Hours/(8*days),0) Workers required 58 110 68 Laid off 0 0 42 Extra hired Hired 11 52 0 Actual production 1020 1670 1130 Laid off from prev month Laid off 0 0 42 Ending inventory 520 730 620 Actual production 1,020 1,670 1,130 Ending inventory 520 730 620 Rate January February March January February March 7 Labor 8932 14630 9996 Labor 8932 14630 9996 3 Inventory = (Beg inv + End inv)* rate/2 1590 1875 2025 translating to table Inventory 1590 1875 2025 260 Hiring 2860 13520 0 Hiring 2860 13520 0 360 Layoff 0 0 15120 Layoff 0 0 15120 Total 13382 30025 27141 Total 13382 30025 27141 Total 70548 Total 70548

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