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Problem 11-5 (Algo) Manager T. C. Downs of Plum Engines, a producer of lawn mowers and leaf blowers, must develop an aggregate plan given the forecast for engine demand shown in the table. The department has a regular output capacity of 135 engines per month. Regular output has a cost of $64 per engine. The beginning inventory is zero engines. Overtime has a cost of $114 per engine. 1 130 Forecast 2. 133 Month 5 128 133 3 132 7 140 8 135 Total 1,056 125 a. Develop a chase plan that matches the forecast and compute the total cost of your plan. Regular production can be less than regular capacity. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required.) 2 3 5 7 Period 8 Total 133 132 130 128 133 125 140 135 1,056 Forecast Output Regular Overtime Output - Forecast Costs Output Regular Overtime Total b. Compare the costs to a level plan that uses inventory to absorb fluctuations. Inventory carrying cost is $4 per engine per month. Backlog cost is $144 per engine per month. There should not be a backlog in the last month. Set regular production equal to the monthly average of total forecasted demand. Assume that using overtime is not an option. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Round average inventory row, Inventory cost row, and Total row values to 1 decimal.) Period 2 3 5 6 7 8 Total 130 133 132 128 133 125 140 135 1,056 Forecast Output Regular Output - Forecast Inventory Beginning Ending Average Backlog Costs Output Regular Inventory Backorder Total

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