i) Let us first plot all the details including the cost details given in the pro

Question

i) Let us first plot all the details including the cost details given in the problem in a tabular format.

Cost = sum of (per unit cost * respective cost element requirement)

Profit = Selling Price - Cost

Please note - Dark Stain cost given is 18 $ per gallon which is 4.5 $ per quart.

ii) Decision Variables - Count of each type product to be manufactured. (Highlighted in pink)

= b,c,s,t,gn,gd

iii) Objective Function - Maximize profit

Profit = (3619 * b) + ..... (3429 * gd)

iv) Constraints

a) Non negativity and Integer constraints

All the decision variables are non negative and integers.

b,c,s,t,gn,gd >=0

b,c,s,t,gn,gd = integers

b) Resource constraints: Please refer cells B22 to D26

Max 400,000 board feet of teak available: (90 * b) + .... (50 * gd) <= 400,000 and so on

c) Constraints on decision variables

1) gn = gd

2.) t>=18% * (b + c + s + t + gn + gd)

3) b >=1000 and s>=1000

4) t <=2500

5) c > = 1100

v) Solution: Please refer to cells B12:C19 and G12

vi) Scenario Analysis

Please refer to the answer report. Constraints on neither board feet of teak nor unskilled labour hours are binding. None of these additional resources are required and hence Pacific Furniture need not go for the opportunities.

Explanation / Answer

Pacific Fumiture of Santa Rosa, CA builds and markets a very small line of very high quality wooden outdoor furmiture to both consumers and resorts. The furniture is primarily made of teak and comes in various styles and stains. The products of interest in plannin g manufacturing for the next year are: 1. 2. 3. The Cape Cod Beach Set Individual Cape Cod Chair 4. 5. The Occasional Table The Garden Fun Bar Set The Quiet Chat Set Cape Cod Chair Quiet Chat Set Occasional Table Garden Fun Bar Set (Natural) Garden Fun Bar Set (Dark Stain) Major resources used in building the Pacific Furniture products are: Cut Teak Wood (36 per board foot) 2. Skilled Woodworker Labor 334 per hour) 3. Unskilled Assembly Labor (310 per hour) 4. Equipment Time ($26 per hour) 5. Dark Stain ($18 per gallon) Cape Cod Beach Set The Cape Cod Beach Set consists of two Cape Cod style chairs and a small table, all made from teak and treated with the dark stain Building an entire set requires 90 board feet of teak, 8 hours of skilled woodworker labor, 1 hour of unskilled assembly labor, 2 hours of equipment time, and 1 12 quarts of dark stain. The set is sold for 54500.

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