What is the total cost of the optimal plan

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Reference no: EM131359542

José Martinez of El Paso has developed a polished stainless steel tortilla machine that makes it a "showpiece" for display in Mexican restaurants. He needs to develop a 5-month aggregate plan. His forecast of capacity and demand follows:

	Month
	1	2	3	4	5
Demand	150	160	130	200	210
Capacity
Regular	150	150	150	150	150
Overtime	20	20	10	10	10

Subcontracting : 100 units available over the 5-month period

Beginning inventory: 0 units

Ending inventory required: 20 units

Costs
Regular-time cost per unit	$100
Overtime cost per unit	$125
Subcontract cost per unit	$135
Inventory holding cost per unit per month	$ 3

Assume that backorders are not permitted. Using the transportation method, what is the total cost of the optimal plan?

Reference no: EM131359542

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