Question

Problem 12-17

Roedel Electronics produces tablet computer accessories, including integrated keyboard tablet stands that connect a keyboard to a tablet device and hold the device at a preferred angle for easy viewing and typing. Roedel produces two different sizes of integrated keyboard tablet stands, small and large. Each size uses the same keyboard attachment, but the stand consists of two different pieces, a top flap and a vertical stand that differ by size. Thus, a completed integrated keyboard tablet stand consists of three subassemblies that are manufactured by Roedel: a keyboard, a top flap and a vertical stand.

Roedel's sales forecast indicates that 7,000 small integrated keyboard tablet stands and 5,000 large integrated keyboard tablet stands will be needed to satisfy demand during the upcoming Christmas season. Because only 500 hours of in-house manufacturing time are available, Roedel is considering purchasing some, or all, of the subassemblies from outside suppliers. If Roedel manufactures a subassembly in-house, it incurs a fixed setup cost as well as a variable manufacturing cost. The following table shows the setup cost, the manufacturing time per subassembly, the manufacturing cost per subassembly, and the cost to purchase each of the subassemblies from an outside supplier:

		Manufacturing
Subassembly	Setup Cost ($)	Time per Unit (min.)	Cost per Unit ($)	Purchase Cost per Unit ($)
Keyboard	1,000	0.9	0.40	0.65
Small top flap	1,200	2.2	2.90	3.45
Large top flap	1,900	3.0	3.15	3.70
Small vertical stand	1,500	0.8	0.30	0.50
Large vertical stand	1,500	1.0	0.55	0.70

(a)	Determine how many units of each subassembly Roedel should manufacture and how many units Roedel should purchase.
	Variable names Value No. of Keyboard manufactured No. of Keyboard purchased No. of Small top flap made No. of Small top flap purchased No. of Large top flap made No. of Large top flap cartridge purchased No. of Small vertical stand made No. of Small vertical stand purchased No. of Large vertical stand made No. of Large vertical stand purchased
	What is the total manufacturing and purchase cost associated with your recommendation?
	$
(b)	Suppose Roedel is considering purchasing new machinery to produce large top flaps. For the new machinery, the setup cost is $3,000; the manufacturing time is 2.5 minutes per unit , and the manufacturing cost is $2.60 per unit. Assuming that the new machinery is purchased, determine how many units of each subassembly Roedel should manufacture and how many units of each subassembly Roedel should purchase.
	Variable names Value No. of Keyboard manufactured No. of Keyboard purchased No. of Small top flap made No. of Small top flap purchased No. of Large top flap made No. of Large top flap cartridge purchased No. of Small vertical stand made No. of Small vertical stand purchased No. of Large vertical stand made No. of Large vertical stand purchased
	What is the total manufacturing and purchase cost associated with your recommendation?
	$
	Do you think the new machinery should be purchased?
	- Select your answer -YesNoItem 23
	Explain.
	The input in the box below will not be graded, but may be reviewed and considered by your instructor.

Answer 1

Create a model in Excel as shown below: F G H А B с D E Manufacturing Purchase Setup Time per Unit Cost per Subassembly Cost per Cost (S) (min.) Unit (S) 2 Unit (S) 3 Keyboard 1,000 0.9 0.4 0.65 4 Small top flap 1,200 2.2 2.9 3.45 5 Large top flap 1,900 3 3.15 3.7 6 Small vertical stand 1,500 0.8 0.3 0.5 7 Large vertical stand 1,500 0.55 0.7 8 9 10 Quantity Manu/pu Subassembly Manufactured Purchased Total 11 12 Keyboard 0 13 Small top flap 0 14 Large top flap 0 15 Small vertical stand 0 16 Large vertical stand 0 17 18 Constraints 19 0.00 30000 20 21 Costs 22 Total Cost 0.00 RHS RHS rc >= 12000 >= 7000 >= 5000 >= 7000 >= 5000 0 0 0 0 0

Enter the constraints in the solver as shown below: Solver Parameters Set Objective: $E$15 To: Max Min Value Of: 0 By Changing Variable Cells: $B$12:$D$16 Subject to the Constraints: $A$19 <= $C$19 $B$12:$B$16 = binary $C$12:$C$16 <= $H$12:$H$16 $E$12:$E$16 >= $G$12:$G$16 Add Change Delete Reset All ► Load/Save Make Unconstrained variables Non-Negative Select a Solving Method: Simplex LP Options Solving Method Select the GRG Nonlinear engine for Solver Problems that are smooth nonlinear. Select the LP Simplex engine for linear Solver Problems, and select the Evolutionary engine for Solver problems that are non-smooth. Help Solve Close

Solution Setup Cost (9) Manufacturing Time per Unit Cost per (min.) Unit (S) Subassembly 0.9 Keyboard Small top flap Large top flap Small vertical stand Large vertical stand 1,000 1,200 1,900 1,500 1,500 Purchase Cost per Unit (S) 0.65 3.45 3.7 0.5 0.7 0.4 2.9 3.15 0.3 0.55 2.2 3 0.8 Quantity Manu/pu Manufactured Purchased Total RHS RHS rc Subassembly Keyboard Small top flap Large top flap Small vertical stand Large vertical stand 0 0 12000.00 0.00 0 7000 5000 0 7000 5000 0 0 12000 7000 5000 7000 5000 >= 12000 >= 7000 >= 5000 >=7000 >= 5000 12000 0 0 7000 5000 Constraints 21400.00 <= 30000 Costs Total Cost 56300.00

a) Variable names Value No. of Keyboard manufactured 12000 No. of Keyboard purchased 0 No. of Small top flap made 0 No. of Small top flap purchased 7000 No. of Large top flap made 0 No. of Large top flap cartridge purchased 5000 No. of Small vertical stand made 7000 No. of Small vertical stand purchased 0 No. of Large vertical stand made 5000 No. of Large vertical stand purchased Total cost = $56,300 b) Change the values in the model develop in the part-a. The answer will not change with the new machinery. The new machinery should not be purchased.