Page 137 - DCAP601_SIMULATION_AND_MODELING

Unit 8: Simulation of Queuing System (II)

Subject to constraints Notes
Special additive: 0.30 x + 0.25 y + 0.75 z less than or equal to 6,50,000
Milling x/2500 + y/ 3500 + z/5000 less than or equal to 110 - 55
x/2500 x 35000 + y/3500 x 35000 + z/5000 x 35000 less than or equal to 55 x 35,000
14x + 10 y + 7z less than or equal to 19,25,000
Packing: x/12000 + y/12000 + z/12000 less than or equal to 100
x + y + z =100 x 12,000 = 12,00,000
0.30x + 0.25y + 0.75z less than or equal to 6,50,000
14x +10y + 7z less than or equal to 19,25,000
x + y + z less than or equal to 12,00,000
Subject to x being less than or equal to 1,20,000
Y being less than or equal to 4,50,000
2,00,000 being less than or equal to and z being less than or equal to 6,00,000. (2,00,000 is
prior commitment)
Right Option
IF THE profit-volume (PV) ratio is 40 per cent and sales value ` 10,000, the variable cost
will be: a) ` 4,000; b) ` 6,000; c) ` 5,000; d) none of the above.
Variable cost ratio is a complement of PV ratio. When PV ratio is 40 per cent, variable cost
ratio is 60 per cent of sales. Sixty per cent of ` 10,000 will be ` 6,000. Hence option (b) is
correct.
In a service department manned by one server, on an average one customer arrives every
five minutes, the service time is four minutes per customer. The probability of the server
being idle is: a) 40 per cent; b) 20 per cent; c) 15 per cent; d) none of the above.
S = 60/4 = 15 per hour.
R = 12/15, that is, 4/5
A = 60/5 =12 per hour.
The probability of server being idle is 1 - R, that is, 1 - 4/5 = 1/5, that is, 20 per cent. Hence,
option (b) is correct.
A company budgets for fixed overhead of ` 24,000 and production of 4,800 units. Actual
production is 4,200 units and fixed overhead cost incurred is ` 22,000. The fixed overhead
volume variance is: a) ` 3,000 (adverse); ` 1,000 (adverse); ` 2,000 (favourable); `
3,000(favourable)

SR = BFO/BQ, that is, ` 24,000 / 4,800 units = ` 5 per unit.
Fixed overhead volume variance = SR (AQ - BQ)
5 (4200 - 4800) = ` 3000 A. Hence, option (a) is correct.

Flexible Budgeting
VIKAS Textiles Ltd has just completed the first year of operation on March 31, 2003, and
the summarised result of the operating as as follows:

Installed capacity: 20,000 kg of yarn
Production and sales: 14,000 kg of yarn
Contd...

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