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Keego Enterprises manufactures two products, boat wax and car wax, in two departments, Mixing and Packaging. The Mixing Department has 600 hours per month
Keego Enterprises manufactures two products, boat wax and car wax, in two departments, Mixing and Packaging. The Mixing Department has 600 hours per month available while the Packaging Department has 1,200 hours per month available. Production of the two products cannot exceed 42,000 pounds. Data on the two products follow: Product Boat wax (B) Car wax (C) Contribution Margin (per 100 pounds) $ 210 $220 Hours per 100 Pounds of Output: Mixing Hours per 100 Pounds of Output: Packaging (M) 5.0 3.1 (P) 2.9 4.0 The Mixing Department (M) constraint for the Keego linear program would be (where B and C are expressed in 100-pound units of output): Triad Children's Center (TCC), a non-profit organization, uses relevant cost analysis to determine whether new services are desirable. TCC is looking at adding a new educational program for grade school children who are having difficulty with their reading and math skills. The following relevant costs are expected if the program is accepted: Costs (per year) Program Director salary Part-time Assistants Variable cost per child $31,000 $30,000 $ 1,000 TCC estimates that a maximum of 40 children will participate in this program in the first year. If TCC decides to implement this program, funding will be received from the City Chamber of Commerce ($47,000) and a local Private University Endowment Fund ($41,000). Calculate the expected surplus or deficit from operations given the above information.
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