bpa-individual assignment

8/7/2019 BPA-Individual Assignment

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INDIVIDUAL ASSIGNMENT

BUSINESS PROBLEM ANALYSIS

MODULE CODE:

MFBS0276


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DECISION VARIABLE

Define the Decision Variables. Since SEMICOND company need to make a

decision on what to produce, below are the decision variables.

X = Number of Tape Recorders to produce

Y = Number of Radio to produce

X 50 (Number of Tape Recorder to produce)

Y 100 (Number of Radio to produce)

COST FUNCTION or OBJECTIVE

Identify the cost function. The main objective of SEMICOND Company is to

maximize the profit (Revenues to be received Variable Production Cost).


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Objective is to Maximize Profit:

P = 20X + 15Y

P = 20X + 15Y 2500

CONSTRAINTS

The constraints identified by SEMICOND Company in order to maximize the

profit are:

i. Constraints in LABOUR COST.

Since SEMICOND Company management has decided that the cash

balance on 1st January 1992 must be at least RM4000, there is a constraint

in Labour Cost. Beginning of 1st December 1991, SEMICOND Company

has an opening cash balance amounting RM10, 000. In order for

SEMICOND to achieve the requirement, they only can spend (RM10, 000


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Y 100 (Raw Material Availability for Radio)

iii. X and Y are non-negative values. We restrict X and Y so that:

X 0 (Non Negative Value)

Y 0 (Non Negative Value)

Subject to condition that:

Subject to the condition that:

50X + 35Y 6000


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CONCLUSION

In order for SEMICOND Company to maximize the profit from December

production, SEMICOND should produce:

Tape Recorder (X) = 50 units

Radio (Y) = 100 units

Profit = 20X + 15Y

= (RM20*50) + (RM15*100)

= RM1000 + RM1500

= RM2, 500


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The companys balance sheet as of 1st January 1992 is as shown below.

ASSET LIABILITIES

Cash 4,000

Accounts Receivable 15,000

Inventories Outstanding 3,500

Bank Loan 9,000

Creditors 2,000

TOTAL 22,500 11,000

SEMICOND Company asset/liability ratio is:

= RM22, 500 / RM11, 000

= 2.05


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Decision Variables

X 50 (Number of Tape Recorder to produce)

Y 100 (Number of Radio to produce)

Cost Function or Objective is to Maximize Profit

P = 20X + 15Y 2500

Subject to the condition that:

50X + 35Y 6000 < /= 6000 ( Constraints in Labour Cost)

X

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