Question
CHUCK SA has the following production plan for the next 4 weeks. The values shown below reflect the maximum capacity levels of the company. The
CHUCK SA has the following production plan for the next 4 weeks. The values shown below reflect the maximum capacity levels of the company. The planned production is equal to the maximum demand for each type of product. | |||||||||
| A | B | C | D | |||||
| $/Unit | $/Unit | $/Unit | $/Unit | |||||
Sale price | 180 | 210 | 90 | 130 | |||||
Raw material cost | 24 | 56 | 22 | 40 | |||||
Labor cost | 66 | 88 | 33 | 22 | |||||
Variable indirect costs | 24 | 18 | 24 | 18 | |||||
Fixed indirect costs | 16 | 10 | 8 | 12 | |||||
Margin per unit | 30 | 42 | 13 | 48 | |||||
Planned Production | 300 | 125 | 240 | 400 | |||||
Labor cost per unit | 6 | 8 | 3 | 2 | |||||
The Direct Labor Force is organizing a strike for two weeks of the next 4 weeks. This means that only a total of 2,160 hours will be available for production, instead of the usual 4,320 hours. | |||||||||
REQUESTED:1. If the strike is carried out, indicate which product or products should be prioritized and in what order if the objective is to maximize utility.
Please explain step by step. |
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