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Fabrinis produces two products namely Spaghetti and Macoroni. The statement below shows the selling price and product costs per unit for each product. SPAGHETTI MACORONI
Fabrinis produces two products namely Spaghetti and Macoroni. The statement below shows the selling price and product costs per unit for each product.
SPAGHETTI | MACORONI | |
R | R | |
Selling price per unit | 71 | 49 |
Variable costs per unit | ||
| 21 | 15 |
| 12 | 8 |
| 8 | 4 |
FiSpaghettied cost per unit | ||
| 20 | 10 |
Total product cost | 61 | 37 |
Profit per unit | 10 | 12 |
Additional information: | ||
Demand per period (units) | 6 000 | 8 000 |
Minutes per unit | 24 | 16 |
Kilograms per unit | 21 | 15 |
Direct material is limited to 35 000 kilograms for the period.
1.The objective function that will maximize the contribution of the company can be determined as follow:
SPAGHETTI + MACORONI
2. The constraint on the kilograms of material available for production can be determined as:
SPAGHETTI + 15 MACORONI <
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