Decision making #2-Use of Limited Resources-Singe Constraint

Bush Manufacturing has 25,000 labor hours available for producing M and N. Consider the following information:

M

N

Required Labor per unit in hours

4

2

Maximum demand in units

8,000

7,000

Contribution Margin per unit

$8

$6.00

Required:

What is the optimal product mix(how many M and N should be produced)? Explain your answer and show computations. You must tell me how many of Product M and N should be produced.

Recommendation: