Production Optimization for a Sports Goods Company

This assignment examines the production optimization strategy for a company manufacturing basketballs and footballs. It analyzes the ideal production units (55,000 basketballs & 40,000 footballs) to maximize profit while efficiently utilizing available machine hours. The report also suggests enhancing production levels based on market demand and total capacity, emphasizing the connection between production, resource utilization, and overall profitability.

Running Head: Business Decision Making
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Project Report: Business Decision Making

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Introduction:
This report depict about a case in which various tools of excel has been analyzed to
identify the total number of units which must be produced by the company to manage the
functions and the performance of the company.
Purpose of the report:
This report has been prepared to analyze the case and make a better decision about the
total production units. This report depicts the management of the company that how much
units would offer them highest return and through which they could utilize the machine hours
at their maximum. Further, this report also assists the management of the company to make
better decision.
Description of problem:
In the given case, ABCD limited is the equipment manufacturing company which
manufactures football and basketball. In the given report, the total machine hours available
for the company has been given and according to that, company could manufacture the
football and basketball. All other given information, such as labour hour, selling price etc has
been given. In the given case, net profit of the company has been analyzed.
Methodology:
For analyzing the total production units of the company, excel spreadsheet has been
used by the company. For solving the case, the machine hours of the company has been
analyzed and further, it has been found that how much time it would take to the company to
produce or manufacture the Basketball and Football (Wheelen & Hunger, 2017). Through the
analysis, it has been found that the 0.5 would be taken for manufacturing the basketball and
0.3 hour would be taken for manufacturing the football (David, 2011).
Through the analysis, it has been found that if company would manufacture
Basketball or Football, than the total machine hours of the company would be 21000 and thus
the rest tile, machine would be idle. So, company is suggested to enhance the level of the
Production of basketball and football (Gaughan, 2010). Further, it has been analyzed that the
total machine hour would be 39500 hours if the production of basketball and football would
be 55000 units and 40000 units. So, company is suggested to manage the level of the

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Production of basketball and football to 55000 units and 40000 units (Fitzsimmons,
Fitzsimmons & Bordoloi, 2008).
Further, it has also been analyzed that it is quite required for the company to manage
the production units according to the machine hours to enhance the level of the production as
well as the profits. Through the analysis, it has been found that the total profit of the company
would be enhanced when the total production of the company would be enhanced; the only
fixed cost of the company is related to its machine hours (Dean & Yunus, 2001). So, if the
company would manufacture 55000 units of the basketball than the total profit of the
company would be $ 3,56,000 and at the same time, if the company would manufacture
40,000 units of the football than the total profit of the company would be $ 2,28,960 (Best,
2009).
Working Note:
Total Machine Hours 39000-40000 Hours
If company would produce, 30000 units of
basketball than total machine hour would
be 15000
Whereas, If company would produce,
20000 units of football than total machine
hour would be 6000
Though, the total machine hour would be 21000 and thus the rest tile, machine would be
idle. So, company is suggested to enhance the level of the Production of basketball and
football.
Further, if company would produce, 55000
units of basketball than total machine hour
would be 15000
Whereas, If company would produce,
40000 units of football than total machine
hour would be 12000
Thus, the total machine hour would be 39500 hours if the production of basketball and
football would be 55000 units and 40000 units. So, company is suggested to manage the
level of the Production of basketball and football to 55000 units and 40000 units (Hill,
2008).
Statement of profit
Basketball Football
Per unit 55000 units Per unit 40000 units

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Selling price
$
14
$
7,70,000 11 440000
Less:
Material Cost $
2
$
1,10,000
1.25 50000
Labour cost $
3
$
1,65,000
1.8 72000
Gross Profit $
9
$
4,95,000
$
8
$
3,18,000
Tax Cost $
1,38,600
$
89,040
Net Profit
$
3,56,400
$
2,28,960
(Stevenson & Hojati, 2007)
Thus through this calculations, it has been analyzed that the company must produce
55000 units if basketball and 40000 units of football to enhance the production level as well
as utilize the minimum resource at their maximum. Further, it also helps the company to
enhance the level of the profit. Through the analysis, it has been found that, if the company
would manufacture 55000 units of the basketball than the total profit of the company would
be $ 3,56,000 and at the same time, if the company would manufacture 40,000 units of the
football than the total profit of the company would be $ 2,28,960 (Wheelen & Hunger, 2017).
Findings:
Through the analysis, it has been found that the company must make a decision about
the production through considering the following points:
1. Fixed cost of the company must be considered by the company before evaluating the
total production units.
2. Variable cost and contribution per units of cost sheet helps the company to analyze
the production units which are quite required for the company to save itself from
losses.
3. Sales price of the company is the main figure to analyze the total profit (Applegate,
Austin, McFarlan & Applegate, 2007).
4. Production unit must be set by the company after analyzing all the related factors,

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5. Through the reports, it has been analyzed that the company must produce 55000 units
if basketball and 40000 units of football to enhance the production level as well as
utilize the minimum resource at their maximum.
6. Company must manufacture the 55000 units of basketball and 40000 units of football
to enhance the profits (by Sara Carter & Jones-Evans, 2009).
Recommendation or conclusion:
To conclude, through these calculations, it has been analyzed that the company must
produce 55000 units if basketball and 40000 units of football to enhance the production level
as well as utilize the minimum resource at their maximum. The main figures which make an
impact over the total production units of the company are total machine hours of the
company. This report has been expressed about the management of the company that how
much units would offer them highest return and through which they could utilize the machine
hours at their maximum. Further, this report also assists the management of the company to
make better decision.
Further, it also helps the company to enhance the level of the profit. Through the
analysis, it has been found that, if the company would manufacture 55000 units of the
basketball than the total profit of the company would be $ 3,56,000 and at the same time, if
the company would manufacture 40,000 units of the football than the total profit of the
company would be $ 2,28,960.
Lastly, it is suggested to the company to enhance the production level, according to
the total capacity and market demand of the products. The machine hours of the company
depict about the total production units of the company. further, the production units affect
over the total net profit of the company.

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References:
Applegate, L. M., Austin, R. D., McFarlan, F. W., & Applegate, L. M. (2007). Corporate
information strategy and management: text and cases. Boston: McGraw-Hill/Irwin.
Best, R. J. (2009). Market-based management: Strategies for growing customer value and
profitability.
by Sara Carter, E., & Jones-Evans, D. (2009). Enterprise and small business: Principles,
practice and policy. Strategic Direction, 25(5).
David, F. R. (2011). Strategic management: Concepts and cases. Peaeson/Prentice Hall.
Dean, E. & Yunus, K. (2001). ”An overview of strategic alliances”. Management Decision,
Vol. 39 Iss 3 pp. 205 – 218.
Fitzsimmons, J. A., Fitzsimmons, M. J., & Bordoloi, S. (2008). Service management:
Operations, strategy, and information technology (p. 4). New York, NY: McGraw-Hill.
Gaughan, PA (2010). Mergers, Acquisitions, and Corporate Restructurings. John Wiley &
Sons.
Hill, C. (2008). International business: Competing in the global market place. Strategic
Direction, 24(9).
Stevenson, W. J., & Hojati, M. (2007). Operations management (Vol. 8). Boston: McGraw-
Hill/Irwin.
Wheelen, T. L., & Hunger, J. D. (2011). Concepts in strategic management and business
policy. Pearson Education India.
Wheelen, T. L., & Hunger, J. D. (2017). Strategic management and business policy. pearson.