Galaxy Candy Company manufactures two popular candy bars, the Eclipse bar and the Nova bar. Both candy bars go through a mixing operation where the various ingredients are combined, and the Coating Department where the bars from the Mixing Department are coated with chocolate. The Eclipse bar is coated with both white and dark chocolate to produce a swirled effect. A material shortage of an ingredient in the Nova bar limits production to 300 batches per day. Production and sales data are presented in the following table. Both candy bars are produced in batches of 200 bars.

Management believes that Galaxy can sell all of its daily production of both the Eclipse and Nova bars. Other data follow.

Required:
1. Formulate the objective function and all of the constraints in order to maximize contribution margin. Be sure to define the variables.
2. How many batches of each type of candy bar (Eclipse and Nova) should be produced to maximize the total contribution margin?
3. Calculate the contribution margin at the optimal solution.
(CMA,adapted)

Transcribed Image Text:

Use of Capacity In Hours per Batch of Product Department Mixing Coating Avallable Daily Capacity In Hours 525 500 Eclipse 1.5 2.0 Nova 1.5 1.0 Selling price per batch.... Variable cost per batch. Monthly fixed costs (allocated evenly between both products). Eclipse $ 600 200 750,000 Nova $ 700 750,000 450