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show in the graph and in simplex method IM26.1 Intermediate: Optimal output using the graphics approach. G Limited, manufacturers of superior garden ornaments, is preparing

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show in the graph and in simplex method

IM26.1 Intermediate: Optimal output using the graphics approach. G Limited, manufacturers of superior garden ornaments, is preparing its production budget for the coming period. The company makes four types of ornament, the data for which are as follows: Pixie EIT Queen King (E per unit) (E per unit) ( per unit) (E per unit) Product 22 35 25 16 25 17 15 18 326 122 Direct materials Variable overhead Selling price 98 111 Hours Hours Hours Hours per unit per unit Direct labour hours: per unit per unit 6 8 10 10 25 Type 1 1 Type 2 Type 3 5 Fixed overhead amounts to 15000 per period. Each type of labour is paid 5 per hour but because of the skills involved, an employee of one type cannot be used for work normally done by another type. The maximum hours available in each type are: Type 1 Type 2 Type 3 8000 hours 20000 hours S) 25 000 hours ng The marketing department judges that at the present selling prices, the demand for the products is likely to be: Pixie Queen King Unlimited demand Unlimited demand 1500 units 1000 units rks) You are required (a) to calculate the product mix that will maximize profit, and the amount of the profit: (14 marks) (b) to determine whether it would be worthwhile paying Type 1 Labour for overtime working at time and a half and, if 50, to calculate the extra profit for each 1000 hours of overtime; (2 marks) (e) to comment on the principles used to find the optimum product mix in part (a), pointing out any possible limitations: (3 marks (d) to explain how a computer could assist in providing a solution for the data shown above (3 marks) CIMA Stage 3 Management Accounting Techniques IM26.1 Intermediate: Optimal output using the graphics approach. G Limited, manufacturers of superior garden ornaments, is preparing its production budget for the coming period. The company makes four types of ornament, the data for which are as follows: Pixie EIT Queen King (E per unit) (E per unit) ( per unit) (E per unit) Product 22 35 25 16 25 17 15 18 326 122 Direct materials Variable overhead Selling price 98 111 Hours Hours Hours Hours per unit per unit Direct labour hours: per unit per unit 6 8 10 10 25 Type 1 1 Type 2 Type 3 5 Fixed overhead amounts to 15000 per period. Each type of labour is paid 5 per hour but because of the skills involved, an employee of one type cannot be used for work normally done by another type. The maximum hours available in each type are: Type 1 Type 2 Type 3 8000 hours 20000 hours S) 25 000 hours ng The marketing department judges that at the present selling prices, the demand for the products is likely to be: Pixie Queen King Unlimited demand Unlimited demand 1500 units 1000 units rks) You are required (a) to calculate the product mix that will maximize profit, and the amount of the profit: (14 marks) (b) to determine whether it would be worthwhile paying Type 1 Labour for overtime working at time and a half and, if 50, to calculate the extra profit for each 1000 hours of overtime; (2 marks) (e) to comment on the principles used to find the optimum product mix in part (a), pointing out any possible limitations: (3 marks (d) to explain how a computer could assist in providing a solution for the data shown above (3 marks) CIMA Stage 3 Management Accounting Techniques

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