1) Model Check: Based on the results of your SOLVER run, what is the Return on S
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Question
1) Model Check:
Based on the results of your SOLVER run, what is the Return on Sales (Ratio of Total Net Profit to Total Revenues)?
Enter your result as a pure number (not %) rounded to 3 decimal places. For example: 0.2574 would be entered as 0.257, not as "25.7%".
2) What is the total NET Profits in the optimized model? Round your answers to the nearest penny. Do not include the "$" symbol or commas. For example, a $1,200.05 is entered as 1200.
3) The Human Resource manager asked the director of production how many additinal workers he needed for the following planning period. Each worker contributes 2,200 hours per year (a planning period).
4) The product manager of the Cluster product line is concerned about the production numbers. Based on the Sensitivity Report, determine the minimum increase or decrease in the unit sales price of the product that should alleviate his concerns. Round your answers to the nearest penny. Use + for increase and - for decrease. Do not include the "$" symbol. For example, a $0.254 decrease is entered as -0.25.
The human resource database includes information on the average increse in wages for workers. (Averaged across the workforce.) Your HR wage and salary consultant suggests that you adjust the prior year's direct labor figures upwards for based on the average of the prior 3 years of increases. Raises have not been determined yet for this planning period, so you must use this estimate CAUTION: Compute carry your results to 3 decimal places in % and DO NOT confuse the two MEANS. Year-3 Year-2 Year-1 Year 0 Time Frame 3 Yr Prior 2 Yr Prior 1 Prior Yr Current Y Increase 1.500% 1.350% 2.000% Assume that the total Selling and Administrative costs remains the same as the prior year. The purchasing department has identified 2 critical ingredients that will be in limited supply next year The information below indicates the quantities contractually committed to the company by its suppliers. The availability of additional quantities cannot be relied upon and any quantities procurable on the open market will be very expensive Purchasing "did their homework 2 years earlier with long term pricing forecasts and then negotiating longer term contracts with suppliers. This limited the materials increases to the numbers listed below, which is below the industry average Pounds Available 100,000 80,000 Limited Raw Materials Nuts Chocolate ncrease in Costs Direct Materials (AlI) 1.50% Crunch Cluster Whole Roasted Optimistic Most Likely Pessimestic 50 45 N/A N/AN/A NA 10 8 100 25 75 20 Booked Orders (In 1000's of Units) Outstanding Sales Contracts for next quarter. (Purchase orders from customers confirmed with committed delivery.) (Note that this is a contractual obligation to deliver!)Explanation / Answer
1. The value of Return on Sales (Ratio of Total Net Profit / Total Revenues) = 80230.41/516840 = 0.155
2. The total NET Profits in the optimized model = 80230
3. The total number of workers required for the project is 4.
4 . The minimum increase or decrease in the unit sales price of the product that should alleviate his concerns is 1.2 decrease for crunch,2.1 decrease and 2.33 increase for roasted,3.12 and 0.9 increase for whole and cluster respecively.
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