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  • Fixed Cost Model

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    Anuj Popli
    97 views3 pages
    The company makes three products - shirts, shorts, and pants. It has available resources like cutting machine hours, stitching machine hours, and labor. It also knows the price and variable cost per unit of each product. The document asks to find the optimum product mix - which products to make and in what quantities to maximize profit. It provides the available resources, costs, prices and capacities for each product. It then shows the decision of which products to produce, the quantities to produce of each, and the theoretical and maximum capacities. The optimum solution is shown with a total profit of 1,048,600.

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    fixed cost model.xlsx

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    The company makes three products - shirts, shorts, and pants. It has available resources like cutting machine hours, stitching machine hours, and labor. It also knows the price and variable cost per unit of each product. The document asks to find the optimum product mix - which products to make and in what quantities to maximize profit. It provides the available resources, costs, prices and capacities for each product. It then shows the decision of which products to produce, the quantities to produce of each, and the theoretical and maximum capacities. The optimum solution is shown with a total profit of 1,048,600.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    97 views3 pages

    Fixed Cost Model

    Uploaded by

    Anuj Popli
    The company makes three products - shirts, shorts, and pants. It has available resources like cutting machine hours, stitching machine hours, and labor. It also knows the price and variable cost per unit of each product. The document asks to find the optimum product mix - which products to make and in what quantities to maximize profit. It provides the available resources, costs, prices and capacities for each product. It then shows the decision of which products to produce, the quantities to produce of each, and the theoretical and maximum capacities. The optimum solution is shown with a total profit of 1,048,600.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    the company makes three products

    Shirts Shorts Pants result Available


    resources Cutting machine hours available 3 1 2 3000 4000
    Stitching machine hours available 2 2 3 4500 4800
    Labour 3 2 4 6000 6000
    Price (Rs/unit) 900 700 1200 1800000
    Variable cost (per unit) 400 300 500 750000
    Fixed cost 1000 1000 1400 1400

    What is the optimum Product Mix

    Assumption fixed cost will not be incurred if the products are not manufactured

    Decision varwhether produced or not 0 0 1


    Qty to be produced 1E-06 0 1500
    theoretical cap on the production (maxim 1400 2400 1500
    maximum capacity 0 0 1500

    profit 1048600
    challmart has offers from 5 warehouse to supply material to 5 cities
    the warehouse capacity, fixed cost to be paid, distribution cost per unit from each wareohouse to each cit

    Which Warehouses will have to be engaged?


    Find the optimum distribution schedule
    city 1 city 2 city 3 Capacity fixed cost
    warehouse 1 20 18 15 5000 12000
    warehouse 2 22 17 18 4000 10000
    warehouse 3 25 21 20 4500 15000
    warehouse 4 22 17 19 4000 9000
    warehouse 5 20 21 20 2000 8000
    demand qty 3000 3500 2800

    city 1 city 2 city 3


    warehouse 1 2200 0 2800 5000
    warehouse 2 0 1.14E-12 0 1.14E-12
    warehouse 3 0 0 0 0
    warehouse 4 0 3500 0 3500
    warehouse 5 800 0 0 800
    3000 3500 2800
    er unit from each wareohouse to each city are given

    Yes/no proposed capacity


    1 12000 5000
    0 0 0
    -1.286779E-16 -1.93E-12 -5.79E-13
    0.875 7875 3500
    0.4 3200 800
    total fixed cost 23075

    total cost 86000


    1.932676E-11
    0
    59500
    16000
    161500
    adding fixed cost 184575

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