SummerFun Inc. produces a variety of recreation and leisureproducts. The product

SummerFun Inc. produces a variety of recreation and leisureproducts. The production manager has developed an aggregateforecast.Month Mar Apr May Jun Jul Aug Sep TotalForecast 50 44 55 60 50 40 51 350Use the following information to develop aggregate plans.Regular production cost $80 per unit Back-order cost $20 perunitOvertime production cost $120 per unit Beginning inventory 0unitsRegular capacity 40 units per monthOvertime capacity 8 units per monthSubcontracting cost $140 per unitSubcontracting capacity 12 units per monthHolding cost $10 per unit per monthDevelop an aggregate plan using each of the following guidelinesand compute the total cost for each plan. Which plan has the lowesttotal cost?a. Use regular production. Supplement using inventory overtimeand subcontracting as needed. No backlogs allowed.b. Use a level strategy. Use a combination of backlogssubcontracting and inventory to handle variations in demand.