Question
The Wyndor Corporation is in the business of manufacturing windows and doors. They have identified unused capacity in three of their manufacturing plants that they
The Wyndor Corporation is in the business of manufacturing windows and doors. They have identified unused capacity in three of their manufacturing plants that they would like to take advantage of through the introduction of two new products: an eight-foot aluminum storm door and a three-foot by two-foot wooden double-hung window. Their only objective in doing so is to increase profits from the business as much as possible. Their accounting department has estimated that the gross margin of selling doors is $4,500 per unit and the gross margin for selling windows is $6,000 per unit. The company can make as many as they wish with these returns. Each door requires one unit of capacity from the Aluminum Frames Plant and three units of capacity from the Glass and Assembly Plant. Each window requires two units of capacity from the Wood Frames plant and two units of capacity from the Glass and Assembly Plant. The Aluminum Frames plant currently has five units of available capacity, Wood Frames has fourteen units and Glass and Assembly has twenty units.
2a. Set up the problem in Excel and use Solver to determine the number of units of doors and windows the company will produce. (5 pts)
b. What is the capacity used at each plant based on your answer in Question 4? (2 pts)
c. What is the profit based on your answer in Question 4? (3 pts)
d. Solve the problem again, this time assuming the net returns from doors will change to (i) $3,000, (ii) $7,000 and (iii)$10,000. Summarize and report what you observe about each of these solutions as compared to your answer in Q4 where the doors earned $4,500. Why did you observe these changes in activity levels, profit levels and plant utilization? (5 pts)
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