Jerusalem Medical Ltd., an Israeli producer of port-able kidney dialysis units and other medical products, develops a 4-month aggregate plan. Demand and capacity (in units) areforecast as follows:CAPACITYSOURCE MONTH 1 MONTH 2 MONTH 3 MONTH 4LaborRegular time 235 255 290 300Overtime 20 24 26 24Subcontract 12 15 15 17Demand 255 294 321 301The cost of producing each dialysis unit is $985 on regular time, $1,310 on overtime, and $1,500 on a subcontract. Inventory car-rying cost is $100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Set up a production plan that minimizes cost using the transpor-tation method.
Jerusalem Medical Ltd., an Israeli producer of port-able kidney dialysis units and other medical products, develops a 4-month aggregate plan. Demand and capacity (in units) areforecast as follows:CAPACITYSOURCE MONTH 1 MONTH 2 MONTH 3 MONTH 4LaborRegular time 235 255 290 300Overtime 20 24 26 24Subcontract 12 15 15 17Demand 255 294 321 301The cost of producing each dialysis unit is $985 on regular time, $1,310 on overtime, and $1,500 on a subcontract. Inventory car-rying cost is $100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Set up a production plan that minimizes cost using the transpor-tation method.
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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Question
Jerusalem Medical Ltd., an Israeli producer of port-
able kidney dialysis units and other medical products, develops
a 4-month aggregate plan. Demand and capacity (in units) are
forecast as follows:
CAPACITY
SOURCE MONTH 1 MONTH 2 MONTH 3 MONTH 4
Labor
Regular time 235 255 290 300
Overtime 20 24 26 24
Subcontract 12 15 15 17
Demand 255 294 321 301
The cost of producing each dialysis unit is $985 on regular time,
$1,310 on overtime, and $1,500 on a subcontract. Inventory car-
rying cost is $100 per unit per month. There is to be no beginning
or ending inventory in stock and backorders are not permitted.
Set up a production plan that minimizes cost using the transpor-
tation method.
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