Deb bishop health and beauty products has developed a new shampoo,

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Deb Bishop Health and Beauty Products has developed a new shampoo, and you need to develop itsaggregate schedule. The cost accounting department has supplied you the costs relevant to the aggregateplan, and the marketing department has provided a four-quarter forecast. All are shown as follows:QUARTER FORECAST1 1,4002 1,2003 1,5004 1,300
COSTSPrevious quarter’s output 1,500 unitsBeginning inventory 0 unitsStockout cost for backorders $50 per unitInventory holding cost $10 per unit for every unit held at the end of the quarterHiring workers $40 per unitLayoff workers $80 per unitUnit cost
$30 per unit
Overtime
$15 extra per unitSubcontracting Not available
Your job is to develop an aggregate plan for the next four quarters.

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a. First, try hiring and layoffs (to meet the forecast) as necessary.b. Then try a plan that holds employment steady.c. Which is the more economical plan for Deb Bishop Health and Beauty Products?

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