Question 1

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the total costs for the month of March using the level production strategy.Assume the regular time production cost as $200/pair of skis,and the average monthly inventory holding cost is $20/pair of skis per month. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

The answer of Consider the estimated aggregate demand for a...

Question 2

Which of the following is FALSE about developing a global sales and operations plan?

Accepted Answer

Developing a global sales and operations plan typically involves addressing challenges such as fluctuations in demand caused by economic and political factors, as well as managing inventory levels and ensuring high quality standards. However, it is not necessarily true that product demand volatility will be lower in a global sales and operations plan - in fact, it may be more difficult to anticipate and respond to changes in demand across different regions and customer segments.

Question 3

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the average inventory for the month of February under a level production strategy.Assume the beginning inventory for January is 8,000 units. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

Under a level production strategy, the production is kept constant throughout the year, and inventory is used to meet fluctuations in demand. To calculate the average inventory for the month of February, we need to calculate the total units produced from January to February and divide it by two.

Total units produced from January to February = (beginning inventory for January) + (demand for January) + (demand for February) = 8000 + 8000 + 7000 = 23,000 units
Average inventory for the month of February = Total units produced from January to February / 2 = 23,000 / 2 = 11,500 / 4 = 2,500 units (since each pair of skis consists of 2 units)

Therefore, the best choice is D) 2,500.

Question 4

The ______ department provides global planners with information on capital expenditure planning and budgeting activities.

Accepted Answer

Capital expenditure planning and budgeting activities are related to financial aspects of a business. Therefore, it is the finance department that provides information on these activities.

Question 5

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the additional number of workers required to meet the production level for the month of January using the chase production strategy.The average number of hours required to produce a pair of skis is 8 hours,and the number of worker hours per month is 160.The current workforce is 100.The beginning inventory for January is zero. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

The answer of Consider the estimated aggregate demand for a...

Question 6

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the firing cost for month of February using the chase production strategy.The average number of hours required to produce a pair of skis is 8 hours,and the number of worker hours per month is 160.The current workforce is 100.The firing cost per worker is $200. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

To calculate the firing cost for February using the chase production strategy, first determine the number of workers needed for February's demand. February's demand is 7,000 pairs of skis. Each pair requires 8 hours to produce, so total hours needed = 7,000 pairs * 8 hours/pair = 56,000 hours. Given each worker works 160 hours per month, the number of workers needed = 56,000 hours / 160 hours/worker = 350 workers. The current workforce is 100 workers, so to meet February's demand, the company would actually need to hire more workers, not fire any. Therefore, the firing cost for February is $0, which is not an option provided, indicating a misunderstanding in the question's premise. However, if we were to calculate based on reducing workers, the calculation would involve determining the difference in workforce requirements between months, which isn't applicable here as the demand increases from January to February. The correct approach shows no firing cost, but given the options, it seems there's been a mistake in interpreting the demand or the options provided.

Question 7

An empty airline seat cannot be held as inventory and sold at a later time.This is an illustration of which of the following statements?

Accepted Answer

This statement reflects the characteristic of services that they cannot be inventoried. Unlike physical products, services cannot be stored for future sale, and hence, any unused capacity goes wasted. This characteristic creates unique challenges for service providers to manage their capacity utilization efficiently. The given statement is not related to demand volatility, labor requirements, or capacity predictability, making options B, C, and D incorrect.

Question 8

Which of the following is NOT an outcome of an effective global sales and operations plan?

Accepted Answer

An effective global sales and operations plan should aim to reduce expedited costs by improving forecast accuracy and inventory management. Therefore, increased expedited costs cannot be an outcome of an effective plan.

Question 9

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the hiring cost for month of January using the chase production strategy.The average number of hours required to produce a pair of skis is 8 hours,and the number of worker hours per month is 160.The current workforce is 100.The beginning inventory for January is zero.The hiring cost per worker is $400. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

To calculate the hiring cost for January using the chase production strategy, first determine the number of workers needed to meet January's demand. January's demand is 8,000 pairs of skis. Each pair requires 8 hours to produce, so total hours needed = 8,000 pairs * 8 hours/pair = 64,000 hours. With each worker providing 160 hours per month, the total number of workers required = 64,000 hours / 160 hours/worker = 400 workers. The current workforce is 100 workers, so 300 additional workers need to be hired. The hiring cost per worker is $400, so the total hiring cost = 300 workers * $400/worker = $120,000.

Question 10

Which of the following statements is FALSE about a global sales and operations plan?

Accepted Answer

A global sales and operations plan requires cross-functional collaboration and integration, rather than being managed separately through respective functions. Therefore, statement C is false. The plan must reconcile product allocations, include formal communication channels, and balance differing stakeholder needs and goals.

Question 11

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the inventory holding costs for the month of March using the level production strategy.Assume the regular time production cost as $200/pair of skis,the average monthly inventory holding cost as $20/pair of skis per month,and the beginning inventory for January is 8,000 units. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

To use the level production strategy, we need to calculate the average monthly demand for the entire year.
Average monthly demand = (Total demand for the year) / (Number of months) 
= (8,000 + 7,000 + 5,000 + 4,000 + 2,000 + 2,000 + 1,000 + 1,300 + 2,000 + 3,000 + 5,700 + 7,000) / 12 
= 4,025 pairs of skis per month

Since we are using the level production strategy, we will produce 4,025 pairs of skis every month.

Inventory at the beginning of March = Inventory at the beginning of February + Production in February - Demand in February 
= 8,000 + 4,025 - 7,000 
= 5,025

Inventory holding cost for March = Average monthly inventory holding cost * Inventory for the month 
= $20/pair * 5,025 pairs 
= $100,500

However, we must also note that we are given the regular time production cost as $200/pair of skis, so the total cost of production for March would be: 
Production cost in March = Production in March * Regular time production cost 
= 4,025 pairs * $200/pair 
= $805,000

Thus, the total cost for March would be: 
Total cost for March = Production cost in March + Inventory holding cost for March 
= $805,000 + $100,500 
= $905,500

Therefore, the inventory holding costs for the month of March using the level production strategy is $100,500, which is option (C).

Question 12

Companies with a well-integrated S&OP typically have ______ days of inventory.

Accepted Answer

The answer of Companies with a well-integrated S&OP typically have...

Question 13

A strategy in which employees of a service company are hired as contractors to work for a certain number of hours per year for fixed sum of money is called ______.

Accepted Answer

The given strategy where employees are contracted to work for a certain number of hours per year for a fixed amount of money is known as an annualized hours strategy. This helps companies to manage labor costs as they can plan their labor requirements in advance and hire workers accordingly. It also provides flexibility to workers as they can choose to work more or fewer hours during specific periods based on business needs. Option A is incorrect because subcontracting involves hiring another company to perform specific tasks or projects. Option B is incorrect because outsourcing involves contracting a third-party company or individual to perform activities that would otherwise be done in-house. Option D is incorrect as the monthly hours strategy does not exist as a standard term used in the human resource management domain.

Question 14

Regular time production cost is given by the formula ______.

Accepted Answer

The regular time production cost is calculated by multiplying the regular time production by the regular time cost per unit.

Question 15

Which of the following does NOT have an impact on a company's choice of global sales and operations planning model?

Accepted Answer

While the buying power of customers may impact a company's overall strategy and pricing decisions, it would not directly affect the choice of a global sales and operations planning model. The volume of demand, nature of products, and strategic direction of the company are more relevant factors to consider when selecting a planning model.

Question 16

Which of the following is FALSE about linking the sales and operations planning process to the operations of the company's supply chain partners?

Accepted Answer

Involving supply chain partners in the sales and operations planning process should reduce uncertainty and increase transparency in the supply chain. Therefore, option B is false. The rest of the options are true. Coordinating the sales and operations planning process improves the overall performance of the supply chain. Involving supply chain partners can lead to the adoption of collaborative planning, forecasting, and replenishment (CPFR) process. Finally, linking the company's sales and operations planning process to the rest of the supply chain improves overall supply chain agility.

Question 17

The number of nurses and doctors that a hospital may need on any given day depends not only on the number of patients but also the types of patient care required.This is an illustration of which of the following statements?

Accepted Answer

The statement suggests that the capacity required for providing services in the hospital is hard to predict. This refers to the challenge of predicting the demand for and the type of care that patients would require, which in turn can affect the number and types of healthcare professionals needed on any given day.

Question 18

The focus of sales and operations planning in the service sector is primarily on ______,in contrast to ______ in manufacturing sector.

Accepted Answer

In the service sector, the focus of sales and operations planning is primarily on workforce scheduling because services often require direct human interaction or involvement, making the scheduling of personnel critical. In contrast, the manufacturing sector focuses more on production planning, which involves the planning of manufacturing processes, machinery, and material requirements to meet product demand.

Question 19

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the regular time production cost for January using the level production strategy.Assume the regular time production cost as $200/pair of skis,the average monthly inventory holding cost is $20/pair of skis per month,and the beginning inventory for January is 8,000 units. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$

Accepted Answer

The level production strategy involves producing the same amount each month. The total annual demand is 48,000 pairs (sum of monthly demands). With 12 months, the monthly production is 4,000 pairs. The regular time production cost for January is 4,000 pairs * $200/pair = $800,000.

Question 20

The mixed strategies used in sales and operations planning for services can be broadly classified into ______ categories.

Accepted Answer

The answer of The mixed strategies used in sales and...

Quiz 20: Sales and Operations Planning