Question
Umbrella Co. is considering the introduction of three new products. Per unit sales and cost information are as follows: (per unit) A B C Sales
Umbrella Co. is considering the introduction of three new products. Per unit sales and cost information are as follows:
| (per unit) | A | B | C |
| Sales price | $ 3.00 | $ 5.00 | $ 16.00 |
| Variable cost | $ 1.20 | $ 3.40 | $ 10.00 |
| Fixed cost | $ 0.50 | $ 1.00 | $ 3.50 |
| Labor hours per unit | 0.75 hrs | 1.25 hr | 2hr |
| Monthly demand in units | 500 | 600 | 240 |
The company has only 1,500hourthe direct labor hours available to commit to production of any new products.
How many of each product should Umbrella Co. produce and sell to maximize its profit?
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
