Safety Ltd manufactures two types of alarm systems used by vehicle manufacturers within South Africa.

REQUIRED:

1 Determine whether material and labour are limiting factors of production. 

2 Prepare the formulas for the constraints. 

3 Prepare the formula for the objective function. 

4 Solve for the quantities of Fire and Escape to be produced, in order to maximise the profits per week.
 

Transcribed Image Text:

Details of the two products are as follows: Selling Price per unit Labour required per unit Direct material required per unit Variable overheads per unit Maximum weekly demand FIRE R1 500 20 hours 4 metres R150 150 units ESCAPE R900 8 hours 5 metres R125 Labour is paid at R30 per hour and raw material costs R50 per metre. 200 units Safety employs 100 workers who each work 45 hours a week. However, employees are only able to work at 90% efficiency. Raw materials (wire) are imported from Taiwan and only 1 000 metres is available each week to be used in production. Details of the two products are as follows: Selling Price per unit Labour required per unit Direct material required per unit Variable overheads per unit Maximum weekly demand FIRE R1 500 20 hours 4 metres R150 150 units ESCAPE R900 8 hours 5 metres R125 Labour is paid at R30 per hour and raw material costs R50 per metre. 200 units Safety employs 100 workers who each work 45 hours a week. However, employees are only able to work at 90% efficiency. Raw materials (wire) are imported from Taiwan and only 1 000 metres is available each week to be used in production.

Answer rating: 100% (QA)

To determine whether material and labor are limiting factors of production we need to compare the ma... View the full answer