Given the following forecast and steady regular output of 550 every month, what total cost would result if overtime is limited to a maximum of 40 units a month, and subcontracting is limited to a maximum of 10 units a month? Unit costs are: Regular output     $20 Overtime $30 Subcontract $25 Average Inventory $10 Backlog $18 Month 1  2  3  4  5 6   Forecast 540  540  570  590  650 680

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ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
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Given the following forecast and steady regular output of 550 every month, what total cost would result if overtime is limited to a maximum of 40 units a month, and subcontracting is limited to a maximum of 10 units a month? Unit costs are:

  • Regular output     $20
  • Overtime $30
  • Subcontract $25
  • Average Inventory $10
  • Backlog $18

Month

1  2  3  4  5

6

 

Forecast

540  540  570  590  650

680

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