(Step-by-Step) Total Cost $54,000 Problem: Sue Badger, is considering two more mixed strategies. Using the data from problem 1, compare plans C and D with plans
| Question: Total Cost | $54,000 |
Problem: Sue Badger, is considering two more mixed strategies. Using the data from problem 1, compare plans C and D with plans A and B and make a recommendation:
Plan C – Keep the current workforce steady at a level producing 1300 units per month. Subcontract the remainder to meet demand. Assume that 300 units remaining from March are available in April.
Plan D – Keep the current workforce at a level capable of producing 1300 units per month. Permit a maximum of 20% overtime at a premium of $40 per unit. Assume that warehouse limitations permit no more than a 180-unit carryover from month to month. This plan means that any time inventories reach 180, the plant is kept idle. Idle time per unit is $60. Any additional needs are subcontracted at a cost of $60 per unit.
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