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Homework answers / question archive / Jamestown Furniture Co
Jamestown Furniture Co. is a small, but the fast-growing manufacturer of living room furniture. Its two principal products are end tables and sofas. There are five processes in the manufacturing at Jamestown: Cutting the lumber, cutting the fabric, sanding, staining, and assembly. Jamestown has one employee working in fabric cutting and one employee working in staining. These are relatively skilled workers and could be replaced only with some difficulty. The cutting and sanding operations are performed by two workers each, and while there is some skill to these operations, it is less critical than for staining and for fabric cutting. Assembly is the least skill-based process and is currently done by one full-time employee and a group of part-timers who provide a total of 175 minutes of working time per week. The other employees work a 40 hour week, with 5 hours off for breaks, training, and personal time. Assume a four week month, and that by prior agreement, any of the employees can be switched from one task to another. The current demand for Jamestown's products and sales prices are provided below. Jamestown expects demand to increase significantly in the coming months (this depends on whether it is able to successfully obtain the order it is negotiating to get from a motel chain). The materials cost for the table is $150 and $275 for the sofa. End TablesSofas Price500800 Current Demand250150 material cost150275 The time required for each activity and the total time available are shown below.
table Time, sofa time, required time, hours available, slack
cut 150.0 45.0 195.0 280.0 85.0
sand 100.0 30.0 130.0 280.0 150.0
assemble125.0 225.0 350.0 700.0 350.0
stain 250.0 120.0 370.0 280.0 -90.0
cut fabric 0.0 90.0 90.0 140.0 50.0
Required:
What is the most profitable production plan for Jamestown? Explain your answer with supporting calculations.
| Given that: | |||
|---|---|---|---|
| Particulars | Demand | Price | Material cost |
| Table | 250 | 500 | 150 |
| Sofa | 150 | 800 | 275 |
Calculating the time for tabke:
Time for complete a work for table = required time for work / total demand
The demand of the table is 250 and time for cutting the table is 150
Hence, time to cut a table = 150 / 250 = 0.6
Sand = 100 / 250 = 0.4
Assemble = 125 / 250 = 0.5
Stain = 250 / 250 = 1
Calculating the time for sofa:
Time for sofa = required time for work/total demand
Demand for sofa = 150
Cut = 45 /150 = 0.3
Sand = 30/ 150 = 0.2
Stain = 120 / 150 = 0.8
Cut fabric = 90 / 150 = 0.6
| Identifying the most profitable product: | ||
|---|---|---|
| Particulars | Table | Sofa |
| Price | 500 | 800 |
| Less: material cost | -150 | -275 |
| Margin | 350 | 525 |
| Constraint time | 1 | 0.8 |
| Through put per hr (margin / constraint time) | 350 | 656.25 |
Thus, Sofa is the most profitable production plan for Jamestown.
