A company that manufactures paving material for driveways and parking lots expects the following demand for its product for the next four weeks:
|
Week number
|
1
|
2
|
3
|
4
|
|
Material (tons)
|
40
|
80
|
60
|
70
|
The company's labor and machine standards and available capacities are as follows:
|
|
Labor
|
Machine
|
|
Production standard (hours per ton)
|
4
|
3
|
|
Weekly production capacity (hours)
|
300
|
200
|
a. Determine the capacity utilization for labor and machine for each of the four weeks.
b. In which weeks do you foresee a problem? What options would you suggest to resolve any problems? What costs are relevant in making a decision on choosing an option?