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Example - Aggregate Production Plan

The document contains two production plans for a company with forecasts available one month and two months in advance. When the forecast is one month in advance, the plan is to produce 2000 units in November and 3000 in December, requiring 20 and 30 workers at a cost of Rs. 80,000 and Rs. 120,000 respectively, plus Rs. 4,000 in laying off 5 workers in November and Rs. 2,500 in hiring 5 workers in December for a total cost of Rs. 206,500 excluding salaries. When the forecast is two months in advance, the plan is to produce 2500 units each month in November and December, requiring 25 workers each month at a cost of Rs. 100,000 for a total cost of Rs

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Amit Admune
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38 views

Example - Aggregate Production Plan

The document contains two production plans for a company with forecasts available one month and two months in advance. When the forecast is one month in advance, the plan is to produce 2000 units in November and 3000 in December, requiring 20 and 30 workers at a cost of Rs. 80,000 and Rs. 120,000 respectively, plus Rs. 4,000 in laying off 5 workers in November and Rs. 2,500 in hiring 5 workers in December for a total cost of Rs. 206,500 excluding salaries. When the forecast is two months in advance, the plan is to produce 2500 units each month in November and December, requiring 25 workers each month at a cost of Rs. 100,000 for a total cost of Rs

Uploaded by

Amit Admune
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Production plan when forecast is available only one month in adv

Month November december total cost Example- Rajasthan S


Salary Jaipur. It export its ty
No. of units to be produced 2000 3000 at Zurich.
No. of workers required 20 30 1. In the Last week o
salary @ Rs. 4000 per worker 80000 120000 200000 month of November.
Hiring Cost 2. In the last week of
No. of worker hired 0 5 3. A worker produce
Hiring cost @ Rs. 500 per worker 0 2500 2500 4.In October, there a
Laying-off cost
5.The salary to the w
No. of worker laid-off 5 0
6. Cost of hiring a wo
7. company has to gi
Laying-off cost @ Rs. 800 per worker 4000 0 4000
8.inventory carrying
Inventory cost 9.There were 25work
No. of units in inventory 0 0
cost @Rs.10 per unit 0 0 0
Grand Total Cost Excluding Salajry 6500

Production plan when forecast is available two months in advan


Month November december total cost
Salary
No. of units to be produced 2500 2500
No. of workers required 25 25
salary @ Rs. 4000 per worker 100000 100000 200000
Hiring Cost
No. of worker hired 0 0
Hiring cost @ Rs. 500 per worker 0 0 0
Laying-off cost
No. of worker laid-off 0 0
Laying-off cost @ Rs. 800 per worker 0 0 0
Inventory cost
No. of units in inventory 500 0
cost @Rs.10 per unit 5000 0 5000
Grand Total Cost Excluding Salary 5000
y one month in advance
Example- Rajasthan Sari is a 100% export-oriented 5000million turnover company based at
Jaipur. It export its typical Rajasthani saris to the European countries through a sales agency
at Zurich.
1. In the Last week of October, the sales agency provided a forecast of 2000 saries for the
month of November.
2. In the last week of November agency provided the forecast for December as 3000 saries.
3. A worker produces 100saris per month.
4.In October, there are 25 workers in the factory.
5.The salary to the worker is Rs. 4000/month.
6. Cost of hiring a worker is Rs. 500.
7. company has to give 20% of the salary as laying-off cost to the worker.
8.inventory carrying cost Rs.10/month/unit
9.There were 25workers available in month of October.

wo months in advance
based at
les agency

for the
00 saries.

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