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Burris Construction Co. is planning an aggregate production schedule to meet the demand for next 6 months. It does not use subcontracting but instead maintains an all-call labor force consisting skilled construction workers. It completes its construction projects using regular time and overtime but limits overtime to 25 percent of regular time each month. The company plans on the basis of twenty-two working days of regular time (eight hours per day) each month.
The company’s current work force consists of fifty construction workers, who are paid at an hourly rate of $12 per hour. Overtime is paid at an hourly rate of $18 per hour. If it completes any construction work late, Burris incurs a penalty cost of $5 per hour per month. It may complete work early but that takes a premium of $2 per hour per month. Construction requirements (in hours) for the next six months are
JAN. FEB. MAR. APR. MAY JUNE
9,000 10,000 11,000 12,000 15,000 18,000
Devise an optimal staffing plan for Burris Construction Co. using the transportation method. (Hint: All constructions should be completed with a penalty cost of $5 per hour per month)
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