1. a) An engineering company Manywada ltd produces two products A and B. The cost data are as
follows: A Shs. B Shs. Selling price 200 250 Direct materials 60 90 Direct labour 80 50 Variable
overheads 30 20 Each product undergoes on operation in the two departments, cutting and
finishing before it emerges as a finished product. The unit time taken by the products and the
maximum available hours in the cutting and finishing operations are given below: Product
Cutting hours Finishing hours A 5 10 B 20 15 Maximum hours available 400 450 Required i.
Formulate an LP problem [3 Marks] ii. Solve by using graphic method to determine the number
of units of A and B to be produced to maximize the contribution [6 Marks] iii. State the
maximum contribution obtained by your solution [1 Mark] iv. Compute slack /surplus for the
constraints [2 Marks v. Identify Binding and Non-binding constraints [1 Mark]