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The Chineke Group of Company manufactures two products, namely product B and product P, and provides you with the following information: Prod. B Prod. P

The Chineke Group of Company manufactures two products, namely product B and product P, and provides you with the following information:

Prod. B

Prod. P

Selling price per unit

80.00

50.00

Less cost of sales:

Direct material A @ R5.00 per kg

15.00

10.00

Direct material B @ R4.00 per kg

8.00

12.00

Direct labour @ R6.00 per hour

12.00

6.00

Variable manufacturing overhead @ R5.00 per labour hour

10.00

5.00

Fixed manufacturing overhead per unit

5.00

5.00

Gross profit

30.00

12.00

Less sales & administrative costs:

Variable

6.00

4.00

Fixed

10.00

5.00

Net profit per unit

14.00

3.00

Take note of the following constraints:

Material A available 360 kg

Material B available 360 kg

Labour hours available 360 hours

Sales units:

Product B: a maximum of 90 and at least 20 units

Product P: a maximum of 80 and at least 10 units

Required:

Calculate the optimal production size for product B, using the graphical method.

NB: You are not required to enter the unit or currency symbol.

Provide your answer in numerical form, with no spaces in between. For example: 1000.

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