#2 Given the following forecast and steady regular output of 580 every month, what total cost

would result if overtime is limited to a maximum of 50 units a month, and subcontracting is limited to a

maximum of 10 units a month? Unit costs are:

Regular output $30

Overtime $40

Subcontract $35

Holding cost $10

Lost Sales $25

Month

Forecast

May Jun Jul Aug Sep Oct Nov Dec Jan

550 550 590

580

600 590 610 590 600

Feb

March April

580 600 610