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LP Model

Par, Inc. is entering the medium- and high-priced golf bag market with a distributor committed to purchasing all produced bags. The production of standard and deluxe models is constrained by limited hours in various manufacturing departments, with specific time requirements for each model. The accounting department has calculated profit contributions of $10 for standard bags and $9 for deluxe bags, prompting the need for a mathematical model to maximize total profit contribution.

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4 views1 page

LP Model

Par, Inc. is entering the medium- and high-priced golf bag market with a distributor committed to purchasing all produced bags. The production of standard and deluxe models is constrained by limited hours in various manufacturing departments, with specific time requirements for each model. The accounting department has calculated profit contributions of $10 for standard bags and $9 for deluxe bags, prompting the need for a mathematical model to maximize total profit contribution.

Uploaded by

mohdali197431
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

7A Simple Maximization Problem6A

Par, Inc. is a small manufacturer of golf equipment and supplies whose management has decided to move
into the market for medium- and high-priced golf bags. Par’s distributor is enthusiastic about the new
product line and has agreed to buy all the golf bags Par produces over the next three months.

After a thorough investigation of the steps involved in manufacturing a golf bag, management determined
that each golf bag produced will require the following operations:

1. Cutting and dyeing the material


2. Sewing
3. Finishing (inserting umbrella holder, club separators, etc.
4. Inspection and packaging

The director of manufacturing analyzed each of the operations and concluded that if the company
produces a medium-priced standard model, each bag will require 7/10 hour in the cutting and dyeing
department, 1/2 hour in the sewing department, 1 hour in the finishing department, and 1/10 hour in the
inspection and packaging department. The more expensive deluxe model will require 1 hour for cutting
and dyeing, 5/6 hour for sewing, 2/3 hour for finishing, and 1/4 hour for inspection and packaging. This
production information is summarized in Table given below

Par’s production is constrained by a limited number of hours available in each department. After studying
departmental workload projections, the director of manufacturing estimates that 630 hours for cutting and
dyeing, 600 hours for sewing, 708 hours for finishing, and 135 hours for inspection and packaging will be
available for the production of golf bags during the next three months.

The accounting department analyzed the production data, assigned all relevant variable costs, and arrived
at prices for both bags that will result in a profit contribution1 of $10 for every standard bag and $9 for 3

every deluxe bag produced. Let us now develop a mathematical model of the Par, Inc. problem that can
be used to determine the number of standard bags and the number of deluxe bags to produce in order to
my0paximize total profit [Link]

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