Question

Shoney Video Concepts produces a line of videodisc players to be linked to personal computers for video games. Videodiscs have much faster access time than tape. With such a computer/video link, the game becomes a very realistic experience. In a simple driving game where the joystick steers the vehicle, for example, rather than seeing computer graphics on the screen, the player is actually viewing a segment of a videodisc shot from a real moving vehicle. Depending on the action of the player (hitting a guard rail, for example), the disc moves virtually instantaneously to that segment and the player becomes part of an actual accident of real vehicles (staged, of course).

    Shoney is trying to determine a production plan for the next 12 months. The main criterion for this plan is that the employment level is to be held constant over the period. Shoney is continuing in its R&D efforts to develop new applications and prefers not to cause any adverse feelings with the local workforce. For the same reason, all employees should put in full workweeks, even if this is not the lowest-cost alternative. The forecast for the next 12 months is

MONTH	FORECAST DEMAND	MONTH	FORECAST DEMAND
January	605	July	205
February	805	August	205
March	905	September	305
April	605	October	705
May	405	November	805
June	305	December	905

     Manufacturing cost is $220 per set, equally divided between materials and labor. Inventory storage cost is $6 per unit per month and is assigned based on the ending inventory level. A shortage of sets results in lost sales and is estimated to cost an overall $23 per unit short.

    The inventory on hand at the beginning of the planning period is 220 units. Twelve labor hours are required per videodisc player. The workday is nine hours. No backorders exist, meaning any unmet demand in one month is not carried over to the next month.

Develop an aggregate production schedule for the year using a constant workforce. For simplicity, assume 22 working days each month except July, when the plant closes down for three weeks' vacation (leaving six working days). Assume that total annual production capacity is greater than or equal to total annual demand (i.e., compute workforce level based on annual demand and annual capacity). (Leave no cells blank - be certain to enter "0" wherever required. Indicate monthly shortages using a negative ending inventory level. Round up the "number of workers" to the next whole number and round down your monthly "Available production" values to the nearest whole number.)

January

February

March

April

May

June

July

August

September

October

November

December

Total

Forecast

605

805

905

605

405

305

205

205

305

705

805

905

Beginning inventory

Available production

Ending inventory

Costs

Total

Lost sales

Inventory

Total

Answer 1

Solution :