The roofing manufacturer described in Examples 1, 2, 3 and 4 of this chapter wishes to consider yet a fourth planning strategy (plan 4). This one maintains a constant workforce of eight people and uses overtime whenever necessary to meet demand. Use the information found in Table 13.3 on page 540. Again, assume beginning and ending inventories are equal to zero.
| TABLE 13.3 | Cost Information |
| Inventory carrying cost | $ 5 per unit per month |
| Subcontracting cost per unit | $ 20 per unit |
| Average pay rate | $ 10 per hour ($80 per day) |
| Overtime pay rate | $ 17 per hour (above 8 hours per day) |
| Labor-hours to produce a unit | 1.6 hours per unit |
| Cost of increasing daily production rate (hiring and training) | $300 per unit |
| Cost of decreasing daily production rate (layoffs) | $600 per unit |
