OPTIMIZATION PRINCIPLE AND ITS’ APPLICATION IN OPTIMIZING LANDMARK UNIVERSITY BAKERY PRODUCTION USING LINEAR PROGRAMMING

This paper deals with the applications of optimization principle in optimizing profits of a production industry using linear programming to examine the production cost and determine its optimal profit. Linear programming is an operation research technique which is widely used in finding solutions to managerial decision problems. However, many enterprises make more use of the trial-and-error method. As such, firms have been finding it difficult in allocating scarce resources in a manner that will ensure profit maximization and/or cost minimization. This paper makse use of secondary data collected from the records of the Landmark University Bakery on five types of bread produced in the firm which include Family loaf, sliced family bread, Chocolate loaf, medium size bread, small size bread. A problem of this nature was identified as a linear programming problem, formulated in Mathematical terms and solved using AMPL software. The solution obtained revealed that Landmark bakery unit should concentrate much more in production of 14,000 loaves of Family loaf and 10,571 loaves of Chocolate bread while others type should be less produced since their value is turning to zero in order to achieve a maximum monthly profit of N1,860,000. From the analysis, it was observed that Family loaf and the Chocolate bread contributed objectively to the profit. Hence, more of Family loaf and Chocolate bread are needed to be produced and sold in order to maximize the profit