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    Argosy University/ Phoniex University/
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Category > Management Posted 10 Dec 2017 My Price 7.00

LMN Ltd

LMN Ltd manufactures three products L, M and N. The company which supplies the two raw materials which are used in all three products has informed LMN that their employees are refusing to work overtime. This means that supply of the materials is limited to the following quantities for the next period:

Material A

1,030 kg

Material B

1,220 kg

No other source of supply can be found for the next period.

Information relating to the three products manufactured by LMN Ltd is as follows:

 

L

M

N

Quantity of material used per unit manufactured:

 

 

 

Material A (kg)

2

1

4

Material B (kg)

5

3

7

Maximum sales demand (units)

120

160

110

Contribution per unit sold

£15

£12

£17.50

Owing to the perishable nature of the products, no finished goods are held.

Requirements

(a) Recommend a production mix which will maximize the profits of LMN Ltd for the forthcoming period.

(b) LMN Ltd has a valued customer to whom they wish to guarantee the supply of 50 units of each product next period. Would this alter your recommended production plan?

Answers

Maurice Tutor
(5)
Status NEW Posted 10 Dec 2017 09:12 PM My Price 7.00

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