Question: Son, Ltd., manufactures a variety of chemical
Son, Ltd., manufactures a variety of chemical products used by photo-processors. Son was recently bought out by a conglomerate, and managers of the two organizations have been working together to improve the efficiency of Son’s operations. Managers have been asked to adhere to weekly operating budgets and to develop operating plans using quantitative methods whenever possible. The manager of one department has been given a weekly operating budget of $11,980 for production of three chemical products, which for convenience shall be referred to as Q, R, and W. The budget is intended to pay for direct labor and materials. Processing requirements for the three products, on a per-unit basis, are shown in the table. 
The company has a contractual obligation for 85 units of product R per week. Material A costs $4 per pound, as does material B. Labor costs $8 an hour. Product Q sells for $122 a unit, product R sells for $115 a unit, and product W sells for $76 a unit. The manager is considering a number of different proposals regarding the quantity of each product to produce. The manager is primarily interested in maximizing contribution. Moreover, the manager wants to know how much labor will be needed, as well as the amount of each material to purchase. Prepare a report that addresses the following issues: The optimal quantities of products and the necessary quantities of labor and materials.
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Labor Material A Material B Product (hours) (pounds) (pounds) 5 1 R W 2 2 2. 2. 4)
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