Valencia Products makes automobile radar detectors and assembles two models: LaserStop and SpeedBuster. Both models use the same electronic components. After reviewing the components required and the profit for each model, the firm found the following linear optimization model for profit, where L is the number of LaserStop models produced and S is the number of SpeedBuster models produced. Implement the linear optimization model on a spreadsheet and use Solver to find an optimal solution. Interpret the optimal solution, identify the binding constraints, and verify the values of the slack variables. Maximize Profit=122 L+ 136 S 19L+12 S≤ 3000 5 L+9 S≤2500 L≥0 and S≥0 (Availability of component A) (Availability of component B) Implement the linear optimization model and find an optimal solution. Interpret the optimal solution The optimal solution is to produce 0 LaserStop models and SpeedBuster models. This solution gives the minimum possible profit, which is $ (Type integers or decimals rounded to two decimal places as needed.)

Valencia Products makes automobile radar detectors and assembles two models: LaserStop and SpeedBuster. Both models use the same electronic components. After reviewing the components required and the profit for each model, the firm found the following linear optimization model for profit, where L is the number of LaserStop models produced and S is the number of SpeedBuster models produced. Implement the linear optimization model on a spreadsheet and use Solver to find an optimal solution. Interpret the optimal solution, identify the binding constraints, and verify the values of the slack variables. Maximize Profit=122 L+ 136 S 19L+12 S≤ 3000 5 L+9 S≤2500 L≥0 and S≥0 (Availability of component A) (Availability of component B) Implement the linear optimization model and find an optimal solution. Interpret the optimal solution The optimal solution is to produce 0 LaserStop models and SpeedBuster models. This solution gives the minimum possible profit, which is $ (Type integers or decimals rounded to two decimal places as needed.)

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter15: Decision Analysis

Section: Chapter Questions

Problem 5P: Hudson Corporation is considering three options for managing its data warehouse: continuing with its...

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KSAs: Understand processes and concepts of cost-volume-profit. How to Calculate unit contribution margin, contribution margin, contribution margin ratio, and operating income?
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I am doing an activity table on ovens. I know the formula is: activity pool cost / activity base = activity rate 63237 / 370 =171 when I do this and get my numbers the system to input out findings says my numbers are wrong. we use the cengage. I don't know what I am doing wrong? I have pasted the numbers below. Please help. Beth McDonald Caldwell Home Appliances Inc. is estimating the activity cost associated with producing ovens and refrigerators. The indirect labor can be traced into four separate activity pools, based on time records provided by the employees. The budgeted activity cost and activity-base information are provided as follows: 1 Activity Activity Pool Cost Activity Base 2 Procurement $63,237.00 Number of purchase orders 3 Scheduling 3,933.00 Number of production orders 4 Materials handling 13,032.00 Number of moves 5 Product development 7,035.00 Number of engineering changes 6 Total cost…
Salem Electronics currently produces two products: a programmable calculator and a tape recorder. A recent marketing study indicated that consumers would react favorably to a radio with the Salem brand name. Owner Kenneth Booth was interested in the possibility. Before any commitment was made, however, Kenneth wanted to know what the incremental fixed costs would be and how many radios must be sold to cover these costs. In response, Betty Johnson, the marketing manager, gathered data for the current products to help in projecting overhead costs for the new product. The overhead costs based on 30,000 direct labor hours follow. (The high-low method using direct labor hours as the independent variable was used to determine the fixed and variable costs.) All depreciation. The following activity data were also gathered: Betty was told that a plantwide overhead rate was used to assign overhead costs based on direct labor hours. She was also informed by engineering that if 20,000 radios were produced and sold (her projection based on her marketing study), they would have the same activity data as the recorders (use the same direct labor hours, machine hours, setups, and so on). Engineering also provided the following additional estimates for the proposed product line: Upon receiving these estimates, Betty did some quick calculations and became quite excited. With a selling price of 26 and just 18,000 of additional fixed costs, only 4,500 units had to be sold to break even. Since Betty was confident that 20,000 units could be sold, she was prepared to strongly recommend the new product line. Required: 1. Reproduce Bettys break-even calculation using conventional cost assignments. How much additional profit would be expected under this scenario, assuming that 20,000 radios are sold? 2. Use an activity-based costing approach, and calculate the break-even point and the incremental profit that would be earned on sales of 20,000 units. 3. Explain why the CVP analysis done in Requirement 2 is more accurate than the analysis done in Requirement 1. What recommendation would you make?
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