Determine its production schedule for next several months

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A manufacturer of riding lawnmowers is trying to determine its production schedule for the next several months. Monthly demand for this product is rather seasonal and is expected to be as follows: 100 in month 1; 150 in month 2; 180 in month 3; 260 in month 4; 210 in month 5; and 70 in month 6. Furthermore, no backlogging of demand is allowed (in other words, all monthly demands must be met on time. It costs this company $800 to manufacture each lawnmower. Inventory on-hand at the end of each month incurs a holding cost of $175 per unit. Assume that at the beginning of this planning horizon, 50 completed riding lawnmowers are in inventory. Note that the most this company can produce each month is 250 lawnmowers. Finally, assume that only 75% of each month’s lawnmowers on-hand (beginning inventory plus the products manufactured during that month) can be used to meet the current month’s demand. Using the shell provided in the file GS1.xlsx, formulate and solve a linear programming model to find a cost-minimizing production schedule for the given planning horizon.

Reference no: EM132222639

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