Question

Mr Bean Mart produces and sales four types of toys namely Blaze (B), Pinocchio (P), Paw Patrol (PP) and Scooby (S). Information relating to the production of these toys is given as follows: B P PP S Sales price/ unit N$200 N$250 N$180 N$400 Materials required per unit N$100 N$150 N$110 N$220 Direct labour (N$10 per hour) N$40 N$50 N$20 N$60 Variable cost per unit N$20 N$25 N$10 N$30 Monthly sales demand (Units) 500 800 1 000 400 There is a limit to the availability of labour and only 8 000 hours are available each month. Requirement: Determine the production mix that maximises throughput and calculate the resultant throughput of your proposed production mix.

Answer 1

Products	B	P	PP	S	Total
SP	$200	$250	$180	$400
Materials	100	150	110	220
DL	40	50	20	60
VC	20	25	10	30
Contibution	40	25	40	90
preference to production	II	III	II	I
Lab hrs/unit	4	5	2	6
MD (units)	500	800	1000	400
Lab hrs consumed	4*500=2000	320*5=1600	2*1000=2000	6*400=2400	8000 hrs
RESULTANT:
Prod. Mix	500	320	1000	400
Total Sales	100000	80000	180000	160000	520000
Total Contribution	20000	8000	40000	36000	104000