Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problems 1. Della Simpson, Inc., sells two popular brands of cookies: Della's Delight and Bonny's Bourbon. Della's Delight goes through the Mixing and Baking departments,

image text in transcribedimage text in transcribed

Problems 1. Della Simpson, Inc., sells two popular brands of cookies: Della's Delight and Bonny's Bourbon. Della's Delight goes through the Mixing and Baking departments, and Bonny's Bourbon, a filled cookie, goes through the Mixing, Filing, and Baking departments. Michael Shirra, vice president for sales, believes that at the current price, Della Simpson can sell all of its daily production of Della's Delight and Bonny's Bourbon. Both cookies are made in batches of 3,000. In each department, the time required per batch and the total time available each day are as follows: Baking Della's Delight Bonny's Bourbon Total available per day Mixing 30 15 660 Department Minutes Filling 0 10 15 15 270 300 Revenue and cost data for each type of cookie are: Revenue per batch Variable cost per batch Contribution margin per batch Monthly fixed costs (allocated to each product) Della's Delight $475 175 $300 $18,650 Bonny's Bourbon $375 125 $250 $22,350 Required: a) Using D to represent the batches of Della's Delight and B to present the bathes of Bonny's Bourbon made and sold each day, formulate the objective function to maximise the contribution margin. b) Formulate the constraints. c) Graph the constraints and determine how many batches of each type of cookie that Della Simpson, Inc., should make and sell each day to maximize the total contribution margin

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Personal Finance An Integrated Approach

Authors: Bernard J. Winger

4th Edition

0198520972, 9780132696302

More Books

Students also viewed these Finance questions