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total overtime wages

Consider the following aggregate production planning problem:
January February
Dema Demand 100 units 120 units
Produ Production plan 110 units 110 units
Numb Number of working days per month 20 20

Additional Data:
Current work force 10 workers
Numb Number of working hours per day 8
Numb Number of hours required per unit 16
Overti overtime rate $20.00 per hour
Invent Inventory carrying cost $10.00/unit/month
No hiring or layoff is allowed. Also no changes are to be made in the production plan given above.
Total overtime wages for January and February will be:

A. $100

B. $1,100

C. $1,600

D. $3,200

E. $6,400

Solution Preview

Total number of hours required for production

(110 units)(16 hrs per unit) + (110 units)(16 hrs per unit) ...

Solution Summary

The total overtime wages are exemplified in this tutorial.