Blossom, Inc., is a small company that manufactures three versions of patio tables. Unit information for its products follows: Table A Table B Table C Sales price $ 50 $ 54 $ 68 Direct materials 10 11 12 Direct labor 2 4 8 Variable manufacturing overhead 4 4 4 Fixed manufacturing overhead 9 9 9 Required number of labor hours 0.5 0.5 1.0 Required number of machine hours 4.0 2.50 2.0 Blossom has determined that it can sell a limited number of each table in the upcoming year. Expected demand for each model follows: Table A 50,000 units Table B 25,000 units Table C 25,000 units Required: 1. Suppose that direct labor hours has been identified as the bottleneck resource. Determine how Blossom should prioritize production by rank ordering the products from 1 to 3. 2 If Blossom has only 60,000 direct labor hours available, calculate the number of units of each table that Blossom should produce to maximize its profit. 3 Suppose that the number of machine hours has been identified as the most constrained resource. Determine how Blossom should prioritize production by rank ordering the products from 1 to 3.

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Blossom, Inc., is a small company that manufactures three versions of patio tables. Unit information for its products follows:

  Table A Table B Table C
Sales price $ 50 $ 54 $ 68
Direct materials 10 11 12
Direct labor 2 4 8
Variable manufacturing overhead 4 4 4
Fixed manufacturing overhead 9 9 9
Required number of labor hours 0.5 0.5 1.0
Required number of machine hours 4.0 2.50 2.0

Blossom has determined that it can sell a limited number of each table in the upcoming year. Expected demand for each model follows:

Table A 50,000 units
Table B 25,000 units
Table C 25,000 units

Required:
1. Suppose that direct labor hours has been identified as the bottleneck resource. Determine how Blossom should prioritize production by rank ordering the products from 1 to 3.

 

2

If Blossom has only 60,000 direct labor hours available, calculate the number of units of each table that Blossom should produce to maximize its profit.

3

Suppose that the number of machine hours has been identified as the most constrained resource. Determine how Blossom should prioritize production by rank ordering the products from 1 to 3.

0

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