Planning Plant Production

Store Name:

abc

Owner Name: abcd

The abc business has been a great success. In an effort to diversify into other
markets, the board of directors has purchased controlling stock of Bradford
Manufacturing. Detail of this problem starts on page 552 of your text. The
purpose of this assignment is to use Solver to forecast the number of
production lines and overtime hours for each quarter.

1
5

abc Production Planning

For the Aggregate Plan worksheet
1. You must enter your business name and your name on the Story Problem worksheet.
2. You must put your name as it appears on you student ID on the properties page of this workbook.
3. Examine the Simulation and Actual Costs worksheets. Be sure there are no errors in the cells (#value).
3. Complete the 'Cost of Plan' table on the Aggregate Planning worksheet. You must use the =sum() function for
each cell.
4. You must use the Solver routine and receive a optimal solution. The model has 8 decision variables (cells that
are permitted to vary). This corresponds to the cells for the 'Lines run' and 'Overtime hours per day' for each of
the four quarters.

5. Minimize the 'Total cost of plan'.

1,000 case units.

Forecast Demand
Ending Inventory Target
Planning Data
Initial number of employees
Employees per line
Standard production rate (each line)
Employee pay rate
Overtime pay rate
Standard hours per shift
Maximum overtime per day
Inventory carry cost
Stockout cost
Employee hiring and training cost
Employee layoff cost

1st (1-13)
2,000
338
Numbers
60
6
450
$20.00
$30.00
7.5
2
$1.00
$2.40
$5,000.00
$3,000.00

Aggregate Plan
Lines run
Overtime hours per day
Beginning Inventory
Production
Expected Demand
Demand from simulation
Ending Inventory
Deviation from Inventory Target
Employees
Cost of Plan
Labor Regular Time
Labor Overtime
Hiring and Training
Layoff
Inventory Carry Cost
Stockout Cost
Quarter Budget

1st (1-13)
10.00
-

Quarter (Week Numbers)

2nd (14-26)
3rd (27-39)
2,200
2,500
385
408

4th (40-52) 1st (Next Year)

Notes
2,650
2,200 Each number is a 13 week forecast.
338
This is calculated based on 6 weeks of future
forecast demand.

Units of measure
employees

Forecast Demand by Quarter (1,000 Case Units)

3,500

Cases per hour

per hour
per hour
hours
hours
per case (per year)
per case
per employee
per employee

3,000
2,500
2,000

1,500
1,000
500

Profit margin loss

0
1st (1-13)

Quarter (Week Numbers)

2nd (14-26)
3rd (27-39)
10.00
10.00
2.00

2nd (14-26)

3rd (27-39)
Forecast Demand
Simulation Demand

4th (40-52)

1st (Next Year)

4th (40-52)
10.00
1.00

200.0
2,193.8
2,000.0
1,979.0
393.8

393.8
2,193.8
2,200.0
2,071.0
387.5

387.5
2,778.8
2,500.0
2,602.0
666.3

666.3
2,486.3
2,650.0
2,876.0
502.5

55.3
60

2.9
60

258.6
60

164.0
60

$624,000
$0
$300,000
$0
$98
$0
$924,098

$624,000
$0
$0
$0
$97
$0
$624,097

$624,000
$7,200
$0
$0
$167
$0
$631,367

$624,000
$3,600
$0
$0
$126
$0
$627,726

Total Cost of Plan

$2,807,288

Employees are paid for 8 hrs work per day.

60 employees are employed currently.
Carrying cost per year, divided by 4, multiplied by 1,000.
Basic on negative deviation from target.

Simulation Worksheet

Qtr Wk

1st

2nd

3rd

4th

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52

Lines
Scheduled

Overtime
Scheduled
(hours)

Beginning
Inventory

Scheduled
Production

Forecast
Demand

Expected
Ending
Inventory

Expected
Weeks-ofSupply

Actual Production
Rate (cases/hour)

Actual Demand
(1,000 Cases)

Actual
Production

Actual Ending
Inventory

10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10

0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
2
2
2
2
2
2
2
2
2
2
2
2
2
1
1
1
1
1
1
1
1
1
1
1
1
1

200.0
220.4
243.9
270.9
300.6
333.1
367.4
404.0
442.6
480.3
516.1
550.6
582.0
611.3
638.4
665.0
690.1
714.4
736.8
756.3
773.5
787.9
795.4
795.6
789.0
774.5
753.5
767.5
778.1
784.8
787.6
787.4
784.2
777.6
769.0
756.4
741.7
723.5
703.7
681.4
635.6
591.5
548.1
506.9
467.8
430.8
397.3
367.0
339.8
316.1
296.6
281.2

168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
168.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
213.8
191.3
191.3
191.3
191.3
191.3
191.3
191.3
191.3
191.3
191.3
191.3
191.3
191.3

153.8
153.8
153.8
153.8
153.8
153.8
153.8
153.8
153.8
153.8
153.8
153.8
153.8
169.2
169.2
169.2
169.2
169.2
169.2
169.2
169.2
169.2
169.2
169.2
169.2
169.2
192.3
192.3
192.3
192.3
192.3
192.3
192.3
192.3
192.3
192.3
192.3
192.3
192.3
203.8
203.8
203.8
203.8
203.8
203.8
203.8
203.8
203.8
203.8
203.8
203.8
203.8

214.9
235.3
258.8
285.8
315.5
348.0
382.3
418.9
457.5
495.2
531.0
565.5
596.9
610.8
637.9
664.5
689.6
713.9
736.3
755.8
773.0
787.4
794.9
795.1
788.5
774.0
774.9
789.0
799.6
806.3
809.0
808.8
805.7
799.0
790.4
777.8
763.1
744.9
725.1
668.8
623.0
578.9
535.5
494.3
455.2
418.2
384.7
354.4
327.2
303.5
284.0
268.6

1.4
1.5
1.7
1.9
2.1
2.3
2.5
2.7
2.9
3.1
3.2
3.4
3.5
3.6
3.8
3.9
4.1
4.2
4.4
4.5
4.5
4.5
4.4
4.3
4.2
4.0
4.0
4.1
4.2
4.2
4.2
4.2
4.2
4.1
4.0
3.9
3.8
3.7
3.6
3.3
3.1
2.8
2.6
2.4
2.2
2.1
1.9
1.7
1.6
1.5
1.4
1.4

481
484
488
490
492
494
495
495
495
493
492
489
486
483
479
475
470
465
460
454
449
444
438
433
428
424
419
416
412
410
408
406
405
405
405
407
408
411
414
417
421
425
430
435
440
446
451
456
462
467
472
476

160.0
158.0
156.0
154.0
152.0
151.0
149.0
147.0
148.0
149.0
150.0
152.0
153.0
154.0
153.0
153.0
152.0
152.0
153.0
153.0
154.0
159.0
164.0
169.0
175.0
180.0
185.0
187.0
189.0
192.0
194.0
196.0
199.0
201.0
205.0
208.0
212.0
215.0
219.0
223.0
223.0
224.0
224.0
224.0
224.0
223.0
222.0
221.0
220.0
218.0
216.0
214.0

180.4
181.5
183.0
183.8
184.5
185.3
185.6
185.6
185.6
184.9
184.5
183.4
182.3
181.1
179.6
178.1
176.3
174.4
172.5
170.3
168.4
166.5
164.3
162.4
160.5
159.0
199.0
197.6
195.7
194.8
193.8
192.9
192.4
192.4
192.4
193.3
193.8
195.2
196.7
177.2
178.9
180.6
182.8
184.9
187.0
189.6
191.7
193.8
196.4
198.5
200.6
202.3

220.4
243.9
270.9
300.6
333.1
367.4
404.0
442.6
480.3
516.1
550.6
582.0
611.3
638.4
665.0
690.1
714.4
736.8
756.3
773.5
787.9
795.4
795.6
789.0
774.5
753.5
767.5
778.1
784.8
787.6
787.4
784.2
777.6
769.0
756.4
741.7
723.5
703.7
681.4
635.6
591.5
548.1
506.9
467.8
430.8
397.3
367.0
339.8
316.1
296.6
281.2
269.5

Actual Costs
Regular
Qtr Wk Production
Cost
1
48,000
2
48,000
3
48,000
4
48,000
5
48,000
6
48,000
1st 7
48,000
8
48,000
9
48,000
10
48,000
11
48,000
12
48,000
13
48,000
14
48,000
15
48,000
16
48,000
17
48,000
18
48,000
19
48,000
2nd 20
48,000
21
48,000
22
48,000
23
48,000
24
48,000
25
48,000
26
48,000
27
48,000
28
48,000
29
48,000
30
48,000
31
48,000
32
48,000
3rd 33
48,000
34
48,000
35
48,000
36
48,000
37
48,000
38
48,000
39
48,000
40
48,000
41
48,000
42
48,000
43
48,000
44
48,000
45
48,000
4th 46
48,000
47
48,000
48
48,000
49
48,000
50
48,000
51
48,000
52
48,000

Overtime
Production
Cost
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
18,000
18,000
18,000
18,000
18,000
18,000
18,000
18,000
18,000
18,000
18,000
18,000
18,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000
9,000

Inventory
Carrying
Cost
4,238
4,690
5,209
5,781
6,406
7,065
7,769
8,512
9,236
9,925
10,589
11,192
11,755
12,276
12,788
13,272
13,738
14,168
14,543
14,875
15,151
15,296
15,300
15,173
14,894
14,490
14,760
14,964
15,093
15,146
15,142
15,081
14,954
14,788
14,545
14,263
13,913
13,533
13,103
12,223
11,375
10,541
9,748
8,995
8,284
7,640
7,057
6,534
6,079
5,704
5,408
5,183

Stockout
Cost
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

Hiring and
Training
Cost
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

Layoff Cost

Total For
Week

Cumulative

0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

52,238
52,690
53,209
53,781
54,406
55,065
55,769
56,512
57,236
57,925
58,589
59,192
59,755
60,276
60,788
61,272
61,738
62,168
62,543
62,875
63,151
63,296
63,300
63,173
62,894
62,490
80,760
80,964
81,093
81,146
81,142
81,081
80,954
80,788
80,545
80,263
79,913
79,533
79,103
69,223
68,375
67,541
66,748
65,995
65,284
64,640
64,057
63,534
63,079
62,704
62,408
62,183

52,238
104,928
158,137
211,918
266,325
321,389
377,159
433,671
490,906
548,832
607,421
666,613
726,368
786,644
847,433
908,704
970,442
1,032,611
1,095,154
1,158,029
1,221,180
1,284,476
1,347,776
1,410,950
1,473,844
1,536,334
1,617,094
1,698,058
1,779,151
1,860,297
1,941,438
2,022,520
2,103,474
2,184,262
2,264,807
2,345,070
2,424,983
2,504,515
2,583,618
2,652,841
2,721,216
2,788,757
2,855,504
2,921,500
2,986,783
3,051,424
3,115,481
3,179,015
3,242,094
3,304,798
3,367,206
3,429,388