What is the optimum product mix to maximize companys operating income? A B Sale price per unit
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Question:
What is the optimum product mix to maximize company’s operating income?
| A | B | |
| Sale price per unit | $12.00 | $28.00 |
| Variable cost per unit | $10.00 | $12.00 |
The products are machine made. Three units of product A can be made with one machine hour and two units of product B can be made with one machine hour.
The company has maximum of 3,000 machine hours available per month. The company can sell up to 18,000 units of product A per month. And up to 3,000 units of product B for the month.
Expert Answer:
To determine the optimum product mix that maximizes the companys operating income we need to analyze ... View the full answer
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