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Abbey & Aliyah Inc. manufacture wool socks and gloves for outdoor sports. Both products must go through a special process which makes the wool water

Abbey & Aliyah Inc. manufacture wool socks and gloves for outdoor sports. Both products must go through a special process which makes the wool water proof. The processing department which does this has a capacity of only 1,280 hours per month. The following information is available about the products manufactured:

Product Socks Gloves
Selling price per unit $30 $40
Variable costs per unit 12 16
Time required to process one unit (in hours) 2 hrs 3 hrs

a) What is the contribution margin per hour of processing for each product?

b) What is the optimal mix of products in units if there are no constraints on demand?

Socks:

Gloves:

c) What is the total contribution margin earned for the optimal mix of products?

Socks (units):

Gloves (units):

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