Tracksaws, Inc Formulation:
Let X = Number of Tractors Produced Per Period

question 52

Short Answer

Tracksaws, Inc. makes tractors and lawn mowers. The firm makes a profit of $30 on each tractor and $30 on each lawn mower, and they sell all they can produce. The time requirements in the machine shop, fabrication, and tractor assembly are given in the table.
$$\begin{array} { l l l l } & \text { Machine Shop } & \text { Fabrication } & \text { Assembly } \\\hline \text { Tractor } & 2 \text { hours } & 2 \text { hours } & 1 \text { hour } \\\text { Lawn Mower } & 1 \text { hour } & 3 \text { hours } & 0 \text { hour } \\\text { Hrs. Available } & 60 \text { hours } & 120 \text { hours } & 45 \text { hours } \\\hline\end{array}$$ Formulation:
Let x = number of tractors produced per period
y = number of lawn mowers produced per period


$\begin{array} { l } \text { MAX 30x+30y } \\\qquad\text { subject to } 2 x + y \quad \leq 60 \\\qquad 2 x + 3 y \quad \leq 120 \\\qquad x \leq 45\end{array}$

The graphical solution is shown below.

-What is the maximum amount a manager would be willing to pay for one additional hour of machining time?

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Definitions:

Retained Earnings

Retained earnings refer to the cumulative amount of net income a company retains, rather than distributing it to shareholders as dividends.

Net Income

The remainder of a company's total revenue after deducting taxes, expenses, and any other costs.

Shareholders' Equity

The portion of the company's assets that belongs to the shareholders after all liabilities have been subtracted.

Dividends in Arrears

Unpaid dividends of cumulative preferred stock for the designated period.