Table 10.1 Bart Incorporated Manufactures Rotary Air Fans and Uses a Production-Planning

question 47

Multiple Choice

Table 10.1
Bart Incorporated manufactures rotary air fans and uses a production-planning horizon of one-half year. It allows for regular time, part time, overtime, and subcontracting production to meet the demand but no more than 12 units may be made by each of these methods. Both anticipation inventory and backorders are allowed. The beginning (or current) inventory is 20 units. Their first attempt at a sales and operations plan has resulted in the following.

-Use the information in Table 10.1. Which of these changes would result in the greatest improvement (in terms of total cost) for the production plan?

• A) Increase anticipation inventory to 30 units at the start of the first month.
• B) Produce an additional 12 units using subcontracting in the second month.
• C) Produce an additional 12 units using overtime in the second and third months.
• D) Reduce anticipation inventory to zero units at the start of the first month.