Question

In: Finance

Andalus Furniture Company has two manufacturing plants, one at Aynor and another at Spartanburg.

Problem 12-27 (Algorithmic)

Andalus Furniture Company has two manufacturing plants, one at Aynor and another at Spartanburg. The cost in dollars of producing a kitchen chair at each of the two plants is given here.

Aynor: Cost = 80Q1 + 5Q12 + 106
Spartanburg: Cost = 28Q2 + 3Q22 + 158

Where

Q1 = number of chairs produced at Aynor

Q2= number of chairs produced at Spartanburg

Andalus needs to manufacture a total of 30 kitchen chairs to meet an order just received. How many chairs should be made at Aynor and how many should be made at Spartanburg in order to minimize total production cost? When required, round your answers to the nearest dollar.

The optimal solution is to produce  chairs at Aynor for a cost of $   and  chairs at Spartanburg for a cost of $  . The total cost is $  .

Solutions

Expert Solution

Used Excel solver to solve this minimization of cost problem with the constraints provided.

On using solver, we get as the optimal solution is to produce 8 chairs at Aynor for a cost of $1066 and 22 chairs at Spartanburg for a cost of $2226. The total cost is $3292


Related Solutions

Andalus Furniture Company has two manufacturing plants, one at Aynor and another at Spartanburg. The cost...
Andalus Furniture Company has two manufacturing plants, one at Aynor and another at Spartanburg. The cost in dollars of producing a kitchen chair at each of the two plants is given here. Aynor: Cost = 66Q1 + 6Q12 + 105 Spartanburg: Cost = 20Q2 + 2.5Q22 + 156 Where Q1 = number of chairs produced at Aynor Q2= number of chairs produced at Spartanburg Andalus needs to manufacture a total of 50 kitchen chairs to meet an order just received....
an us company has two manufacturing plants one in UAE and one in another country. Both...
an us company has two manufacturing plants one in UAE and one in another country. Both produce the same items,eath for sale in their perspectives countries. However their productivity figures are quite different. The analyst thinks this is because the UAE plan uses more automated equipment for processing while the other uses a high percentage for labor. 1-explain how that factor can cause productivity figures to be misleading. 2-Is there another way to compare the two plants that would be...
Overhead variances, ethics. Zeller Company uses standard costing. The company has two manufacturing plants, one in...
Overhead variances, ethics. Zeller Company uses standard costing. The company has two manufacturing plants, one in Nevada and the other in Ohio. For the Nevada plant, Zeller has budgeted annual output of 4,000,000 units. Standard labor hours per unit are 0.25, and the variable overhead rate for the Nevada plant is $3.25 per direct labor hour. Fixed overhead for the Nevada plant is budgeted at $2,500,000 for the year. For the Ohio plant, Zeller has budgeted annual output of 4,200,000...
Overhead variances, ethics. Zeller Company uses standard costing. The company has two manufacturing plants, one in...
Overhead variances, ethics. Zeller Company uses standard costing. The company has two manufacturing plants, one in Nevada and the other in Ohio. For the Nevada plant, Zeller has budgeted annual output of 4,000,000 units. Standard labor hours per unit are 0.25, and the variable overhead rate for the Nevada plant is $3.25 per direct labor hour. Fixed overhead for the Nevada plant is budgeted at $2,500,000 for the year. For the Ohio plant, Zeller has budgeted annual output of 4,200,000...
Calculating Manufacturing Cycle Efficiency Indy Company has the following data for one of its manufacturing plants:...
Calculating Manufacturing Cycle Efficiency Indy Company has the following data for one of its manufacturing plants: Maximum units produced in a quarter (3-month period): 250,000 units Actual units produced in a quarter (3-month period): 210,000 units Productive hours in one quarter: 25,000 hours The actual cycle time for Indy Company is 7.14 minutes, and the theoretical cycle time is 6 minutes. Required: 1. Calculate the amount of processing time and the amount of nonprocessing time. If required, round your answers...
1) A book manufacturing company has two different production plants, plant A and plant B. 40%...
1) A book manufacturing company has two different production plants, plant A and plant B. 40% of books come from plant A. Of the books that come from plant A 30% are defective and 70% work as intended. Of the books from plant B 10% are defective and 90% work as intended. On top of this 10% of the defective books from plant A explode. A) Draw a tree diagram of this data. B) What is the probability of randomly...
A steel company is considering the relocation of one of its manufacturing plants. The company’s executives...
A steel company is considering the relocation of one of its manufacturing plants. The company’s executives have selected four areas that they believe are suitable locations. However, they want to determine if the average wages are significantly different in any of the locations, since this could have a major impact on the cost of production. A survey of hourly wages of similar workers in each of the four areas is performed with the following results. Do the data indicate a...
A steel company is considering the relocation of one of its manufacturing plants. The company’s executives...
A steel company is considering the relocation of one of its manufacturing plants. The company’s executives have selected four areas that they believe are suitable locations. However, they want to determine if the average wages are significantly different in any of the locations, since this could have a major impact on the cost of production. A survey of hourly wages of similar workers in each of the four areas is performed with the following results. Do the data indicate a...
A steel company is considering the relocation of one of its manufacturing plants. The company’s executives...
A steel company is considering the relocation of one of its manufacturing plants. The company’s executives have selected four areas that they believe are suitable locations. However, they want to determine if the average wages are significantly different in any of the locations, since this could have a major impact on the cost of production. A survey of hourly wages of similar workers in each of the four areas I performed with the following results. Hourly Wages ($) Area 1...
is there another way to compare the two plants that would be more meaningful
is there another way to compare the two plants that would be more meaningful
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT