Table 10.1 Bart Incorporated Manufactures Rotary Air Fans and Uses a Production-Planning

Multiple Choice

Table 10.1
Bart Incorporated manufactures rotary air fans and uses a production-planning horizon of one-half year. It allows for regular time, part time, overtime, and subcontracting production to meet the demand but no more than 12 units may be made by each of these methods. Both anticipation inventory and backorders are allowed. The beginning (or current) inventory is 20 units. Their first attempt at a sales and operations plan has resulted in the following.

-Use the information in Table 10.1. If anticipation inventory were 30 units at the start of the first month, what would the backorder cost be in the fourth month?

A) $840
B) $740
C) $640
D) $540