Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A rm manufactures two products, A and B. There is only one machine with 6000 hours available per year. Each unit of product A requires

image text in transcribed
image text in transcribed
A rm manufactures two products, A and B. There is only one machine with 6000 hours available per year. Each unit of product A requires 5 machine hours while each unit of Product B requires 4 machine hours. A summary of the protability of each product is provided below. Product A Product B Selling price $150 $120 Costs: Direct material $50 $15 Direct labour $20 $25 Variable overhead $15 $20 Maximum yearly demand for Products A is 800 units and for Product B is 1200 units. Required: (a) Determine how many units of each product should be produced to maximise yearly prot. (2 marks) (b) If we now assume that in addition to the machine hour constraint, the firm also is constrained by the amount of labour available with a maximum of 5000 direct labour hours available for the year. Product A uses 4 direct labour hour per unit and Product B uses 5 direct labour hours per unit. Given this additional constraint, determine how many units of each product should be produced to maximise profits. What prot will be generated

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

College Accounting A Practical Approach

Authors: Jeffrey Slater, Debra Good

13th Canadian edition

134616316, 134166698, 9780134632407 , 978-0134166698

More Books

Students also viewed these Accounting questions

Question

All state trial courts have general jurisdiction.(True/False)

Answered: 1 week ago

Question

2. What do the others in the network want to achieve?

Answered: 1 week ago

Question

1. What do I want to achieve?

Answered: 1 week ago