ScholarMatic | 24/7 Homework Help

ScholarMatic Will Help You Write Your Essays and Term Papers

Answered » You can buy a ready-made answer or pick a professional tutor to order an original one.

Question: Salem Industries, Inc. Salem Industries, Inc. is a medium –size producer of custom metal products…

by | Nov 30, 2023 | Posted Questions



Salem Industries, Inc.

Salem Industries, Inc. is a medium –size producer of custom
metal products. Some of their work is done on a made-to-order
basis, but much of the work is relatively high volume. For example,
the company recently got a contract to make the chassis for
well-known microcomputer. This part will be produced using
dedicated, highly automated equipment. But the company frequently
gets contracts to make special orders of custom products. These are
usually produced on general- purpose equipment and involve a high
degree of skilled labor. For medium-range planning purposes the
company divides its products according to the type of process
required- job shop or line flow. Further, demand requirements for
job shop are stated in terms of hours because of the large number
of different products produced, each requiring various amounts of
purchasing time. On the other hand, the line-flow product demand is
stated in units since production rate is relatively constant for
these items. The forecasted demand in each area for the coming year
is stated below:

________________________________________________________________________

    
Month                               
Manual Operations    
           
Automatic
Operations             

                                   
    Demand Forecast
(hours)               
Demand Forecast (units)    

________________________________________________________________________       

    
January                                          
1,800                                      
6,000        

    
February                                        
1,500                                      
4,000                

    
March                                            
1,900                                      
5,000

    
April                                              
1,600                                      
6,000

    
May                                               
2,000                          
           
5,000

    
June                                               
2,200                                      
6,000

    
July                                                
2,000                                      
7,000

    
August                                          
1,800                                      
6,000

    
September                                     
1,700                                      
5,000

    
October                                         
1,800                                      
6,000

    
November                                     
2,000                                      
8,000

    
December                                      
1,500                                      
6,000

Normally, both operations work eight hours per day, five days
per week. The automatic operation produces at an average of 40
units per hour. Any time that process is operating, five employees
who earn $12.50 per hour must be present. Work on products
requiring manual operations is a little different. Each employee
there earns an average of $16.00 per hour and there are currently
ten employees. Extra employees can be hired in that area, but the
cost of advertising, interviewing, and so on is about $500 per
employee hired. Any employees laid off receive one month’s pay as
compensation. Overtime work per worker is paid at 50 percent
premium and is limited to two hours per day on weekdays and four
hours on Saturday.

Bill Dixon is a product manager for Salem. He is working on
developing an aggregate plan for the coming year and has two major
concerns. First, the company’s relations with its employees have
been good, but there is some talk of unionizing. Too many layoffs
could lead to more than talk. Second, the cost of carrying
inventory has been increasing. The custom-made products are not
inventoried, but high- volume products are inventoried at an
average cost of $1.50 per unit per month. Carrying cost is a major
concern with 2,000 units now in stock.

Suppose you are Bill Dixon, develop the best aggregate plan that
meets Salem’s company objectives and determine the total costs
associated with that plan.       
  

ScholarMatic: Explanation & Answer

Your ready answer from a verified tutor is just a click away for as little as $14.99


  

Click Order Now to get 100% Original Answer Customized to your instructions!

HOME TO CERTIFIED WRITERS

Why Place An Order With Us?

  • Certified Editors
  • 24/7 Customer Support
  • Profesional Research
  • Easy to Use System Interface
  • Student Friendly Pricing

Have a similar question?

PLAGIRAISM FREE PAPERS

All papers we provide are well-researched, properly formatted and cited.

TOP QUALITY

All papers we provide are well-researched, properly formatted and cited.

HIGHLY SECURED

All papers we provide are well-researched, properly formatted and cited.

ScholarMatic: Get Started

Assignment Writing Service

Feel safe and secure when placing an order on our portal!
Fruitful cooperation begins with solid guarantees, and we are professional enough to promise perfect results. Let’s get it started!

Open chat
1
Scan the code
ScholarMatic
Hello! Welcome to to our WhatsApp support.
We offer READY solutions, HIGH QUALITY PLAGIARISM FREE essays and term-papers.

We are online and ready to help