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Question: Leatherco is contracted to manufacture batches of pants, vests, and jackets. Each product require…

by | Nov 30, 2023 | Posted Questions



Leatherco is contracted to manufacture batches of pants, vests,
and jackets. Each product requires a special setup of the machines
needed in the manufacturing processes. The following table provides
the pertinent data regarding the use of raw material (leather) and
labor time together with cost and revenue estimates. Current supply
of leather is estimated at 3000 ft2, and available labor
time is limited to 2500 hours.

Pants Vests Jackets
Leather material per unit (ft2) 5 3 8
Labor time per unit (hr) 4 3 5
Production cost per unit ($) 30 20 80
Equipment setup cost per batch ($) 100 80 150
Price per unit ($) 60 40 120
Minimum number of units needed 100 150 200

Determine the optimum number of units that Leatherco must
manufacture of each project.

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