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Utilization of a Constraint Broze Corp. Company makes four products in a single facility. These products have the following unit product costs. The selling price,
Utilization of a Constraint Broze Corp. Company makes four products in a single facility. These products have the following unit product costs. The selling price, costs, labor requirements, and demand of the three products are as follows: Product A Product B Product C Selling price per unit $50 $30 $40 Variable cost per unit $35 $10 $30 Direct Labor hours per unit 1.5 3 2 Demand 1,000 2,000 500 a. In what order should Castor prioritize production of the products? (Answer: product A, then B, then C) b. How many of each product should be sold during the labor shortage (labor hours are limited to 3,000) to maximize profit? (Answer: 1,000 units of Product A, 500 units of Product B, and 0 units of Product C)
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