Company maintains a level production strategy

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Table 9.1

                     Quarter                  Forecast            

                         1                            80,000             

                         2                          110,000             

                         3                          100,000             

                         4                           110,000

 

Hiring Cost $100 per worker   

Firing Cost $150 per worker   

Inventory Carrying Cost $ 5 per unit     

Production Per Employee           1000 units per/qtr

Beginning Work Force 100 workers       

Using the data in Table 9.1, which of the following statements is true if the company maintains a level production strategy?

a) The total number of units inventoried for the 4-quarter period is    40,000 units.

b) The cost of the level production plan is $18,000.

c) There are 12,500 units inventoried in quarter 3.

d) A work force of 14 workers is maintained during the 4-quarter period.

SHOW THE CALCULATIONS

Reference no: EM131803994

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