Test 2 OPM530 Aug 2013

QUESTION 1

Haqen Food Industry Sdn Bhd is preparing its aggregate plan for the second half of the year. The table below contains monthly demand estimates.

Month	Expected Demand (units)
January	18,000
February	21,000
March	17,500
April	12,500
May	12,000
June	13,500

 

Production Time	:	10 minutes / unit
Working hours	:	10 hours / day
Days per month	:	22 work days / month
Current number of workers	:	10 workers
Overtime capacity	:	600 units per month
Average labour cost	:	RM10 / hour
Overtime cost	:	RM12 / hour
Subcontract cost	:	RM20 / unit
Inventory Holding cost	:	RM0.50 / unit per month
Beginning Inventory	:	800 units

 

Management prefers to keep a constant workforce and production level, absorbing variations through inventory excesses, overtime and subcontract. Demand not met will be outsourced to its sister company. Develop an aggregate plan and compute the total cost that will meet the demand and other conditions of the problem.

(11 marks)

Answer:

For a worker à 1 unit = 10 minutes à 1 hour = 60 minutes / 10 minutes = 6 units / hour à 1 day = 10 hours X 6 units = 60 units / day à 1 month = 60 units X 22 days = 1,320 units / month   Therefore, for 10 workers à 1,320 units X 10 workers = 13,200 units                                                                       (1 mark)

 

Month		Demand	Actual Prod	Inv Change	Beginning stock	Overtime	Subcontract	End inv
January		18,000	13,200	-4,800	800	600	3,400
February		21,000	13,200	-7,800		600	7,200
March		17,500	13,200	-4,300		600	3,700
April		12,500	13,200	700		-	-	700
May		12,000	13,200	1,200	700	-	-	1,900
June		13,500	13,200	-300	1,900	-	-	1,600
		94,500	79,200			1,800	14,300	4,200
Marks given			(1 mark)			(1 mark)	(1 mark)	(1 mark)
	Total cost for the plan 1)     Regular cost = Total unit produced X cost per hour = 79,200 units / 6 unit  per hour X RM10 per hour = RM132,000                                                                                                                  (1 mark) 2)     Overtime cost = 1,800 units / 6 unit per hour X RM12 per hour =  RM3,600                                                                                                                     (1 mark) 3)     Subcontract cost = 14,300 units X RM20 per unit = RM28,600                                                                                                                    (1 mark) 4)     Inventory holding cost = 4,200 units X RM0.5. per unit per month = RM2,100                                                                                                                      (1 mark) 5)     Therefore, Total cost = RM132,000 + RM3,600 + RM28,600 + RM2,100 = RM166,300                                                                                                                (2 marks)

 

QUESTION 2

Discuss the three (3) phases of project management. Support your answer by relevant examples.

(9 marks)

 

Answer: 1)    Project planning 2)    Project scheduling 3)    Project control Students are required to discuss on these three points. Answer must be supported by relevant examples. (any four points X 5 marks = 20 marks)