Table 15.2 Archie Toys Is a Retailer Operating Out of Wichita,Kansas.It Experiences

question 187

Multiple Choice

Table 15.2
Archie Toys is a retailer operating out of Wichita,Kansas.It experiences a seasonal demand pattern for its services.Labor requirements over a typical six-month period follow.The workforce requirements (expressed as number of employees) are given in the following table for the next six periods. Costs associated with operations are as follows:
Wages = $800 per worker per month
Hiring cost = $300 per worker
Layoff cost = $200 per worker
The current workforce level is nine workers,and the undertime is paid for.Use the spreadsheet approach and the preceding data to answer the following questions.
-Use the information in Table 15.2.Suppose that overtime is allowed up to 25% of the regular-time capacity,and that overtime wages are 150% of the regular-time rate.The total cost of the level strategy with overtime and undertime,which also minimizes undertime,is:

• A)less than or equal to $60,000.
• B)greater than $60,000 but less than or equal to $65,000.
• C)greater than $65,000 but less than or equal to $70,000.
• D)greater than $70,000.

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