Production plan for MacPherson Refrigeration Limited

Productivity (units per worker

per month) 40
Regular time wage
($/worker/month) $2,400
Overtime wage ($/worker/month) $3,300
Hiring cost per
worker hired $1,800
Layoff cost per
worker laid off $1,200
Inventory
Holding
Cost/Month $8

Month Dec Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Totals
Production
Plan
Shipment
Forecast 4400 4400 6000 8000 6600 11800 13000 11200 10800 7600 6000 5600 95,400
Production Plan 6400 6400 6400 6400 9480 9480 9480 11120 10800 7600 6000 5600 95,160
Shipments 4400 4400 6000 8000 6600 11800 13000 11200 10800 7600 6000 5600 95,400
Production
Capacity 6400 6400 6400 6400 9480 9480 9480 11120 10800 7600 6000 5600 95,160
Inventory 240 2,240 4,240 4,640 3,040 5,920 3,600 80 0 0 0 0 0 23,760
Inventory
Capacity 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 6000 72,000
Extradorinary
Labor Costs
Hirings 0 0 0 0 77 0 0 0 0 0 0 0 77
Layoffs 0 0 0 0 0 0 0 0 0 47 40 10 97
Worker Months
Overtime 0 0 0 0 0 0 0 40.99999992 32.99999993 0 0 0 74
Number of
Workers 160 160 160 160 160 237 237 237 237 237 190 150 140 2,305
Max Layoffs
(100%) 100% 160 160 160 160 237 237 237 237 237 190 150 140 2,305
Max Overtime
(100%)** 100% 0 0 0 0 0 0 0 40.99999992 32.99999993 0 0 0 74

Cost of
Alternative 1
Hiring Costs $138,600
Layoff Costs $116,400
Inventory
Holding Costs $190,080.00
Regular Labor $5,532,000
Optima Labor $244,200
Total Costs $6,221,280