The Operations Research Analyst for a Big Manufacturing Firm in Oregon

question 6

Essay

The operations research analyst for a big manufacturing firm in Oregon developed the following variable definitions for an LP maximization problem she was working on.The company was trying to determine how many consoles of each model to produce next week given each console had to go through three production departments.She obtained the following optimal simplex tableau for the problem and wanted to interpret its meaning.Variable definitions:
x_l = number of model 1 consoles produced
x₂ = number of model 2 consoles produced
s₁ = unused personnel hours in department 1
s₂ = unused personnel hours in department 2
s₃ = unused personnel hours in department 3
objective function = total profit on model 1 and model 2 consoles produced in the coming week
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Optimal tableau ​

Determine product costs under activity-based costing.

Compare unit product costs under traditional costing and activity-based costing.

Calculate overhead assigned to products using traditional costing methods.

Calculate activity rates for various cost pools under activity-based costing.