Compute the maximum profit given the optimal mix

Assignment Help Financial Accounting

Reference no: EM13947639

Paper Products, Inc., produces table napkins and facial tissues. The manufacturing process is highly mechanized; both products are produced by the same machinery by using different settings. For the coming period, 200,000 machine hours are available. Management is trying to decide on the quantities of each product to produce. The following data are available (for napkins, one unit is one package of napkins; for facial tissues, one unit is one box of tissues):

	Napkins	Tissues
Machine hours per unit	1.00	0.50
Unit selling price	$2.50	$3.00
Unit variable cost	$1.50	$2.25

Required

1. Determine the units of each product that should be produced in order to maximize profits.

2. Because of market conditions, the company can sell no more than 150,000 packages of napkins and 300,000 boxes of facial tissues. Do the following:

a. Formulate the problem as a linear programming problem.

b. Determine the optimal mix using a graph.

c. Compute the maximum profit given the optimal mix.

Reference no: EM13947639

Questions Cloud

Estimate the rate of heat loss from the duct : For an uninsulated duct whose average surface tem- perature is 50°C, estimate the rate of heat loss from the duct. The surface emissivity and convection coefficient are approximately 0.5 and 4 W/m2 · K, respectively.

Discuss ways to effectively integrate technology : Discuss ways to effectively integrate technology into a developmentally appropriate early childhood education program. Describe how technology can be used to adapt instruction for children with special needs and for those who are learning English

Expected return given these three economic state : Refer to the table below to complete this question. "Compute the expected return given these three economic states, their likelihoods, and the potential returns Economic State Probability Return Fast Growth 0.20 40% Slow Growth 0.50 10% Recession 0.2..

Convection coefficient and emissivity : If the temperature of the outer surface is 400 K and its convection coefficient and emissivity are h = 20 W/m2 · K and s = 0.8, respectively, what is the temperature of the inner surface if the wall has a thermal conductivity of k = 0.7 W/m2 · K?

Compute the maximum profit given the optimal mix : Formulate the problem as a linear programming problem. Determine the optimal mix using a graph. Compute the maximum profit given the optimal mix.

About the after-tax salvage value : Your firm needs a machine which costs $140,000, and requires $29,000 in maintenance for each year of its 5-year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 5-year class life category. Assume a tax rate of 30% ..

Relationship between gender and exam performance for student : What is the relationship between exam anxiety and exam performance for students? What is the relationship between gender and exam performance for students?

Create a classroom map that is appropriate for the age : Create a classroom map that is appropriate for the age/stage you will be working with. Explain your rationale for furniture arrangement, use of wall space, shelving and materials, and control of environmental factors, etc. Discuss how this room des..

What is the yield to call : A firm's bonds have maturity of 10 years with a $1000 face value, an 8% semi-annual coupon, are callable in 5 years, at $1,050, and currently sells at a price of $1,100. What is the yield to call (YTC)?

User Account

All Pages