Here. there is a production direction in the Better Fitness. Inc. ( BFI ) which manufactures two types of machines ( BodyPlus100 and BodyPlus200 ) . The elaborate math has been done in the study as per the statistics given for its production of the two assortments of the machines. The natural stuff costs in each subdivision dwelling in the industry of the specific machine ( either BodyPlus100 or BodyPlus200 ) .
The labour costs are besides given which sums up the production cost of the machine so as to cipher the entire cost for its industry. The net net incomes are calculated and recommended that the industry of one BodyPlus100 machine provides more net income than that is produced in the industry of one BodyPlus200 machine.
As the net net income made per hr in the industry of one BodyPlus100 is $ 24. 73 and where every bit. the net net income made per hr in the industry of one BodyPlus200 is $ 19. 83
In this instance issue. the company Solutions Plus is an industrial chemicals company that produces specialised cleansing fluids and dissolvers for a broad assortment of applications. The chief issue is that this company has been invited to send on a command to provide Great North American railway with a cleansing fluid for engines. The chief instance is to cover with the math related to the production cost and the transportation from two different topographic points ( Cincinnati and Oakland. California ) .
The Solution Plus itself can non bring forth and present the full sum of needed gallons of the cleansing agent and sing the larger distances to transport these cleaning agents. the transportation charges are besides included as the outgo for fabricating the cleansing agent. The command has is sent after make up one’s minding that the full production from Cincinnati and Oakland. California shorts the exact demand of the cleansing agents from eleven ( 11 ) different locations in America.
Since the demand is non precisely met. the supply of the cleansing agents to Pendleton is made short of 17. 615 gallons. The ground merely Pendleton is made short of its required trade because. the transportation costs are more to the topographic point from Cincinnati. Besides. specified that merely 500. 000 gallons of cleaning agent can be supplied from Cincinnati and merely 50. 000 gallons can be sent to any location from Oakland. California. The command is for a contract of two old ages. So the transportation costs may change after one twelvemonth as the fuel rates might fluctuate. So the Director of selling of Solution Plus has to offer now forward spying the fluctuations in the fuel monetary value.
Hence. due to the limitation of the entire figure of gallons supplied from Cincinnati. we could merely provide 972. 937 gallons of the engines cleaning agent to the 11 different locations where the exact demand is 990. 522 gallons of the cleansing agent. When the command is made for $ 1. 821. 214. 39 for one twelvemonth. so the net net income that is made in one twelvemonth is $ 237. 749. 72