Drew's company, Ace High, sells customized sets of poker chips. He is developing a plan for next year on a quarterly basis. The expected demand is 500, 900, 600 and 600 set of chips, respectively, through quarters one through four. He currently has 70 sets on hand (initial inventory) that can be used to meet next years demand. He can produce 450 per quarter at the regular rate of $60 per set. His team will work overtime when needed and available, producing up tp 300 units in Q1, 150 in Q2, none in Q3, and 200 in Q4. Sets provided via overtime cost a total of $90 per set. He can leverage a competitor firm and outsource (subcontract) production at the cost of $110 per set, with a capacity of 300 units per quarter. Storage costs are $5 per set per quarter. Drew has determined that he will have a policy of back-ordering at a costs of $1.50. Based on utilizing the Transportation method. A.) What is the optimal cost for Drew? B.) How many total units would be produced via overtime. C.) How many total units would be produced via subcontracting D.)Was there a need to back-order? If so, how many units and what was the total backordering costs?
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
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Drew's company, Ace High, sells customized sets of poker chips. He is developing a plan for next year on a quarterly basis. The expected demand is 500, 900, 600 and 600 set of chips, respectively, through quarters one through four. He currently has 70 sets on hand (initial inventory) that can be used to meet next years demand. He can produce 450 per quarter at the regular rate of $60 per set. His team will work overtime when needed and available, producing up tp 300 units in Q1, 150 in Q2, none in Q3, and 200 in Q4. Sets provided via overtime cost a total of $90 per set. He can leverage a competitor firm and outsource (subcontract) production at the cost of $110 per set, with a capacity of 300 units per quarter. Storage costs are $5 per set per quarter. Drew has determined that he will have a policy of back-ordering at a costs of $1.50.
Based on utilizing the Transportation method.
A.) What is the optimal cost for Drew?
B.) How many total units would be produced via overtime.
C.) How many total units would be produced via subcontracting
D.)Was there a need to back-order? If so, how many units and what was the total backordering costs?
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