Question
Recently, due to a safety audit, the company was advised it had to update its factory premises so for three months they will have limited
Recently, due to a safety audit, the company was advised it had to update its factory premises so for three months they will have limited machine hour capacity of 840 machine hours on their main assembly lines, however the company wants to maximise profitability over this period. The following information is known about their normal production usage of labour hours: Folded Ducting Round ducting Sell Price (per metre) $158.00 $181.00 Variable production costs per metre $95.00 $99.75 Contribution margin (SPVC) $63.00 $81.25 Machine hours to produce: 0.2 0.25 Weekly Demand (if all orders could be fulfilled in metres) 2500 1900 Required: During the next month while machine hours are limited, calculate the quantities of each product the company should produce over the three months to maximize profit.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started