Question
A company will manufacture a total of 5000 units of its product at plants A and B. At plan A the unit cost for
A company will manufacture a total of 5000 units of its product at plants A and B. At plan A the unit cost for labor and material combined is $2.50, while at plant B it is $3.00. The fixed costs at plant A are $6000 and at plant B they are $8000. Between the two plants the company has decided to allot (split) no more than $28,000 for total costs. What is the minimum number of units that must be produced at plant A?
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Fundamental Accounting Principles
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