# Linear Programming

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Linear Programming - Analytical Methods of Supply Chain Management

Problem 2

The Tots Toys Company is trying to schedule production of two very popular toys for the

next three months: a rocking horse and a scooter. Information about both toys is given

below.

Beg. Inv.

June 1

30

10

Scooter

Plastic

Available

3500

5000

4800

Time

Available

2100

4000

2500

Monthly Demand

Horse

220

350

600

Monthly Demand

Scooter

450

700

520

Required

Plastic/Unit

5

4

Required

Time/Unit

2

3

Production

Cost/Unit

10

12

Holding

Cost/Unit/Month

1.50

1.20

Toy

Rocking

Horse

Summer Schedule

June

July

August

Develop a linear programming model that would tell the company how many of each toy

to produce during each month. You are to minimize total cost (production cost + holding

cost). Inventory holding cost will be levied on any items in ending inventory on June 30,

July 31, or August 31 after demand for the month has been satisfied. The company wants

to end the summer with 85 rocking horses and 50 scooters as beginning inventory for

Sept. 1.

Questions: How many of each toy will be produced each month? What will the total

cost equal? Be sure to specify that all variables are integer.

Define the decision variables, the objective function, and the constraints within your

answer to this question. Then, solve the model using Excel Solver. Finally, copy your

spreadsheet into the appendix of your Word report and submit your Excel file to the

dropbox.

2

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#### Solution Summary

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