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Haifa Instruments, an Israeli producer of portable kidney dialysis units and other medical products, develops a 4 month aggregate plan. Demans and capacity (in units) are forecast as follows:
Capacity Source
Labor regular
Labor Overtime
Subcontract
Demand
Month 1: 235; 20; 12; 255
Month 2: 255; 24; 15; 294
Month 3: 290; 26; 15; 321
Month 4 : 300; 24; 17; 301
The cost of producing dialysis unit is $985 on regular time, $1310 on overtime, and 1500 on a subcontract. Inventory carrying cost is 100 per unit, per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Set up a production plan that minimizes cost using the transportation method. DETAILED please.
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