Question

Suppose that the requirements​ (in gallons) for the next four quarters are revised to 140 comma 000​, 60 comma 000​, 90 comma 000​, and 90 comma 000 respectively. If total demand is the​ same, what level of production rate is needed​ now, using the same strategy as​ above? The new quarterly production rate is nothing gallons. ​(Enter your response as an​ integer.)

Answer 1

Solution and Explanation:

As per the given data:

Quarter 1 = 90000, Quarter 2 = 90000, Quarter 3 = 60000, Quarter 4 = 140000

a. Quarterly production rate is calculated as follows:

Q = ( 90000 + 90000 + 60000 + 140000 ) divide by 4

after calcualting the above equation, we get, = 95000 gallons per quarter tin order to meet the demand.

b. Anticipation inventory:

1 st quarter = 95000 minus 90000 = 5000 gallons

2 nd quarter = 95000 minus 90000 = 5000 + 5000 in prior quarter = 10000 gallons

3 rd quarter = 95000 minus 60000 = 35000 + 10000 in prior quarters = 45000 gallons

4th quarter = 140000 minus 450000 minus 95000 = 0 gallons.