A companys productive capacity is limited to 480,000 ma chine hours. Product X requires 10 machine hours

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A company’s productive capacity is limited to 480,000 ma¬ chine hours. Product X requires 10 machine hours to produce; and ProductY requires 2 machine hours to produce. Product X sells for $32 per unit and has variable costs of $12 per unit; Product Y sells for $24 per unit and has variable costs of $10 per unit. Assuming that the company can sell as many of either product as it produces, it should:

a. Produce X and Y in the ratio of 57% and 43%.

b. Produce X and Y in the ratio of 83% X and 17% Y.

c. Produce equal amounts of Product X and Product Y.

d. Produce only Product X.

e. Produce only Product Y.

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Related Book For  book-img-for-question

Fundamental Accounting Principles Volume 2

ISBN: 9780077716660

21st Edition

Authors: John Wild, Ken Shaw, Barbara Chiappetta

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