Standard Pump recently won a $14 million contract with the U.S. Navy to supply 2,000 custom-designed submersible pumps overthe next four months. The contract calls for the delivery of 200 pumps at the end of May, 600 pumps at the end of June,600 pumps at the end of July, and 600 pumps at the end of August. Standard's production capacity is 500 pumps in May,400 pumps in June, 800 pumps in July, and 500 pumps in August. Management would like to develop a production schedule thatwill keep monthly ending inventories low while at the same time minimizing the fluctuations in inventory levels from month tomonth. In attempting to develop a goal programming model of the problem, the company's production scheduler let x denotethe number of pumps produced in month m and s denote the number of pumps in inventory at the end of month m. Here,m = 1 refers to May, m = 2 refers to June, m = 3 refers to July, and m = 4 refers to August. Management asks you to assist theproduction scheduler in model development.(a) Using these variables, develop a constraint for each month that will satisfy the following demand requirement.Beginning Current+(Inventory/ Production A) = (TThis Month'sDemandMayJuneJulyAugustX₁, 5, ≥ 0, 1 = 1, 2, 3, 4(b) Write goal equations that represent the fluctuations in the production level from May to June, June to July, and Julyuly toAugust. (Let d be the deviation variable below the target value of goal i, and dp be the deviation variable above the targetvalue of goal i for i = 1, 2, 3.)May to JuneJune to JulyJuly to AugustXS pidi 20,/= 1, 2, 3, 4May(c) Inventory carrying costs are high and Standard Pump would like to keep their monthly ending inventories low. Develop goalequations with a target of zero for the ending inventory in May, June, and July. (Let d be the deviation variable below thetarget value of goal i, and do, be the deviation variable above the target value of goal i for i= 4, 5, 6.)JuneJulyMaySpjdnj 20, i = 1, 2, 3 and j = 4, 5, 6(d) In addition to the goal equations developed in parts (b) and (c), develop constraints for the production capacities for eachmonth.June300JulyEnding=Inventory.Augustx, 20, 1, 2, 3, 4Min(e) Assuming the production fluctuation and inventory goals are of equal importance, write an objective function for a goalprogramming model which, when used with the constraints constructed in parts (a) - (d), can be used to determine the bestproduction schedule. Develop and solve a goal programming model to determine the best production schedule.What is the optimal solution to the goal programming model?(X₁ X₂ X3 X41 S₁ S₂, S3, S4) =

sm is the ending inventory for month mxm is the number of pumps produced in month mm = 1, 2, 3, 4…

Standard Pump recently won a $14 million contract with the U.S. Navy to supply 2,000 custom-designed submersible pumps over the next four months. The contract calls for the delivery of 200 pumps at the end of May, 600 pumps at the end of June, 600 pumps at the end of July, and 600 pumps at the end of August. Standard's production capacity is 500 pumps in May, 400 pumps in June, 800 pumps in July, and 500 pumps in August. Management would like to develop a production schedule that will keep monthly ending inventories low while at the same time minimizing the fluctuations in inventory levels from month to month. In attempting to develop a goal programming model of the problem, the company's production scheduler let xm denote the number of pumps produced in month m and sm denote the number of pumps in inventory at the end of month m. Here, m = 1 refers to May, m = 2 refers to June, m = 3 refers to July, and m = 4 refers to August. Management asks you to assist the production scheduler in model development. (a) Using these variables, develop a constraint for each month that will satisfy the following demand requirement. May Beginning Inventory + Current Production Ending Inventory. This Month's Demand

Standard Pump recently won a $14 million contract with the U.S. Navy to supply 2,000 custom-designed submersible pumps over the next four months. The contract calls for the delivery of 200 pumps at the end of May, 600 pumps at the end of June, 600 pumps at the end of July, and 600 pumps at the end of August. Standard's production capacity is 500 pumps in May, 400 pumps in June, 800 pumps in July, and 500 pumps in August. Management would like to develop a production schedule that will keep monthly ending inventories low while at the same time minimizing the fluctuations in inventory levels from month to month. In attempting to develop a goal programming model of the problem, the company's production scheduler let xm denote the number of pumps produced in month m and sm denote the number of pumps in inventory at the end of month m. Here, m = 1 refers to May, m = 2 refers to June, m = 3 refers to July, and m = 4 refers to August. Management asks you to assist the production scheduler in model development. (a) Using these variables, develop a constraint for each month that will satisfy the following demand requirement. May Beginning Inventory + Current Production Ending Inventory. This Month's Demand

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.1SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...

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Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?
A forecast of 240 units in January, 320 units in February, and 240 units in March has been approved for the seismic-sensory product family manufactured at the Rockport facility of Maryland Automated, Inc. Three products, A, B, and C, comprise this family. The product mix ratio for products A, B, and C for the past 2 years has been 35 percent, 40 percent,and 25 percent, respectively. Management believes that the monthly forecast requirements are evenly spread over the 4 weeks of each month. Currently, 10 units of product C are on hand. The company produces product C in lots of 40, and the lead time is 2 weeks. A production quantity of 40 units from the previous period is scheduled to arrive in week 1. Thecompany has accepted orders of 25, 12, 8, 10, 2, and 3 units of product C in weeks 1 through 6, respectively. Prepare a prospective MPS for product C and calculate the availableto-promise inventory quantities.
Gregory has started a small agricultural business that specialises in maize and sunflower seeds inGrey Town, KZN. His produce is AgriSA approved, and his organisation is looking to hire a supply chain management consultant given their impact and contribution to the local economy. You have been recruited by Gregory, assist him with the following questions: Gregory is uncertain as to which replenishment system he should use. Differentiate between the continuous review and periodic review models and suggest the most suited for him with the aid of at least two practical examples.Note: you are required to provide a paraphrased overview of the models before at least two practical examples are provided to support the choice.
a) For an upcoming red carpet evening, a company is selling tickets at $60 per person at a large theatre which has a capacity of 10,000 people. Each attendant is expected to buy $12 of food and merchandise at the film evening. The cost of providing the food and merchandise is estimated to be $5 per person. All other ancillary services will be provided by the theatre. Initial analysis indicates that the ancillary cost of providing food and merchandise, as well as the staff needed to handle ticket sales, may be described as a semi-variable cost. Data on these costs and tickets sold from three similar events held at the venue have been collected and are tabulated below: Tickets Sold Cost ($) 2100 6640 3824 11284 4650 13525 Use the high-low method to estimate the total cost function relating to these ancillary costs. b) The company will be renting the theatre which will host the upcoming red carpet evening. The budgeted fixed cost of both renting the theatre and paying the…
Define "what-if analysis." How can a spreadsheet be used to plan capacity?
Q46 Mixing Company manufactured 2,500 units of its only product during 2022. The inputs for this production are as follows: 550 pounds of Material A at a cost of $2.50 per pound 400 pounds of Material H at a cost of $3.75 per pound 700 direct labor hours at $60 per hour The firm manufactured 3,920 units of the same product in 2021 with the following inputs: 700 pounds of Material A at a cost of $2.20 per pound 560 pounds of Material H at a cost of $3.50 per pound 600 direct labor hours at $58 per hour The partial operational productivity of Material A in 2021 is: Multiple Choice 5.60 units per pound. 0.44 units per pound. 4.67 units per pound. 5.18 units per pound. 0.51 units per pound.
The vessel, nicknamed Lovers Deep, is a specially adapted leisure submarine designed and furnished for couples to spend their time together in complete isolation and harmony underwater, Staffed by an on-board crew of three, consisting of a captain, chef and personal butler, Lovers Deep has a unique capability of being moored at various locations chosen by customers, whether that be a stunning coral reef off the coast of St. Lucia or a sunken battleship in the Red Sea. A honeymoon package including a stay in Lovers Deep submarine is an example of Select one: a. Veblen service b. Snob service c. Bandwagon service d. None of the above
Explain the relationship between priority versus capacity that must exist within the production planning and control area of an industry.
Peppers Lockdown produces keys for homes and cars. As Peppers planned for next year’s production,the company decided to implement a high-low system to forecast future costs. With total productionof 2,500,000 keys at a total cost of $10,000 in 2018, and total production of 3,000,000 keys at a totalcost of $20,000 in 2019, what is the variable cost per key?
Recent residential and industrial growth in Butler County has the potential for increasing demand by as much as 100 units. Which supplier should Tri-County contract with to supply the additional capacity? Amount Cost Southern - Hamilton fill in the blank 38 $fill in the blank 39 Southern - Butler fill in the blank 40 fill in the blank 41 Southern - Clermont fill in the blank 42 fill in the blank 43 Northwest - Hamilton fill in the blank 44 fill in the blank 45 Northwest - Butler fill in the blank 46 fill in the blank 47 Northwest - Clermont fill in the blank 48 fill in the blank 49 Total Cost $fill in the blank 50 From the new solution we see that Tri-County should contract with Gas for the additional 100 units.
Eight Glasses A Day: The EGAD Bottling Company has decided to introduce a new line of premium bottled water that will include several designer flavors. Marketing manager Georgianna is predicting an upturn in demand based on the new offerings and the increased public awareness of the health benefits of drinking more water. She has prepared aggregate forecasts for the next six months, as shown, Month May June July Aug Sep Oct Total Forecast 50 60 70 90 80 70 420 Production manager Mark Mercer, has developed the following information. (Note: Costs are in thousands of dollars). Regular production cost: $1 per tankload Regular production capacity: 60 tankloads Overtime production cost: $1.6 per tankload Subcontracting cost: $1.8 per tankload Holding cost: $2 per tankload per month Back ordering cost: $5 per month per tankload Beginning inventory: 0 units Among the strategies being considered are: 1. Level production supplemented by up to 10 tank loads a month from overtime 2. A…
Jose Martinez of El Paso had developed a polished stainless-steel tortilla machine that makes it a “showpiece” for display in Mexican restaurants. He needs to develop a 5-month aggregate plan. His forecast of capacity and demand follows: Month 1 2 3 4 5 Demand 150 160 130 200 210 Regular capacity 150 150 150 150 150 Overtime capacity 20 20 10 10 10 Subcontracting: 100 units available over the 5-month period (NOT 100 units each month) Beginning inventory: 0 units Ending inventory required at the last month (i.e. month 5): 20 units. Costs Regular-time cost per unit $100 Overtime cost per unit $125 Subcontracting cost per unit $135 Inventory holding cost per unit per month $3 Assume that backorders are not permitted. a) Find an aggregate production plan using the intuitive lowest cost approach. (i.e. Develop an aggregate plan using the transportation method). b) State the corresponding…