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Can someone please answer question 1 (7marks) please? Fortune Ltd. manufactures three products A, B and C using the same materials over three different processes.
Can someone please answer question 1 (7marks) please?
Fortune Ltd. manufactures three products A, B and C using the same materials over three different processes. The following is the detailed information of sales, costs and resources required for each of the three products: A B c Sales (/ unit) 70 60 27 Direct Materials (/ unit) 3 2.5 1.8 Processing time per unit in hours: Process 1 0.50 0.50 0.40 Process 2 0.25 0.40 0.25 Process 3 0.40 0.25 0.25 The total processing time of the factory per year is limited to 225,000 hours. Total other operational expenses (including all direct Labour costs and fixed costs) for the period under consideration is 20.25 million. The company's management is still in the process of finalising the demand estimates for each of the three products for the period, but the figures indicate that one of the processes represents a bottleneck and the total processing time available will not be enough to satisfy the demand in full. Required: 1. Based on the given data, identify the bottleneck process and explain why it represents a bottleneck (briefly explain this concept). (7 marks)Step by Step Solution
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