4.2.* The Pine Furniture Company makes fine country furni- ture. The company\'s

Question

4.2.* The Pine Furniture Company makes fine country furni- ture. The company's current product lines consist of end tables, coffee tables, and dining room tables. The production of each of these tables requires 8, 15, and 80 pounds of pine wood, respec- tively. The tables are handmade and require one hour, two hours, and four hours, respectively. Each table sold generates $50, S100, and $220 profit, respectively. The company has 3,000 pounds of pine wood and 200 hours of labor available for the coming week's production. The chief operating officer (Coo) has asked you to do some spreadsheet modeling with these data to analyze what the product mix should be for the coming week and make a recommendation. a. Visualize where you want to finish. What num- bers will the COO need? What are the decisions that need to be made? What should the objective be? b. Suppose that Pine Furniture were to produce three end tables and three dining room tables. Calculate by hand the amount of pine wood and labor that would be required, as well as the profit generated from sales. c. Make a rough sketch of a spreadsheet model, with blocks laid out for the data cells, changing cells, output cells, and objective cell. Build a spreadsheet model and then solve it. E* d.

Explanation / Answer

a. The COO need the number of end tables, coffee tables and dining room tables to be manufactured in the coming week to maximize the profit with the resources available. The decisions that need to be made is regarding manufacturing different types of tables. The objective is to maximize the profit. b. End tables Dining Room Tables Units to produce 3 3 Pine wood required 24 240 Labour required 3 12 Profit generated $150 $660 Pine wood required 3 x 8pounds 3 x 80 pounds Labour required 3 x 1 hour 3 x 4 hours Profit generated 3 x $50 each 3 x $220 each c. Rough Sketch End Tables Coffee Tables Dining Room Tables Profit per table $50 $100 $220 Total Resources Resources used per Table Total Used Available Pine wood 8 15 80 103 ? 3000 Labour (hours) 1 2 4 7 ? 200 Total Profit Number of table 1 1 1 $370 d. Spreadsheet model End Tables Coffee Tables Dining Room Tables Profit per table $50 $100 $220 Total Resources Resources used per Table Total Used Available Pine wood 8 15 80 3000 ? 3000 Labour (hours) 1 2 4 200 ? 200 Total Profit Number of table 0 40 30 $10,600 Thus, Pine Furniture Company should produce 40 coffee tables and 30 Dining room tables while not producing end tables to earn a profit of $10,600

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