Serra Industries is a fine food company producing burgers and sausages. It has 300 staff who work
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Serra Industries is a fine food company producing burgers and sausages. It has 300 staff who work 8 hours a day, 5 days a week for 50 weeks. The demand for burgers and sausages does not exceed 50,000 and 150,000 kilos annually. Fixed factory overheads are applied on the basis of direct labor hours @$1 per hour.
| burgers | sausages |
$ | $ | |
Sales | 10 | 15 |
Variable costs | 5 | 6 |
Contribution margin | 5 | 9 |
Fixed costs | 2 | 4 |
Profit | 3 | 5 |
What are the maximum profit and the most profitable mix of products?
Related Book For
Statistical Techniques in Business and Economics
ISBN: 978-0078020520
16th edition
Authors: Douglas Lind, William Marchal
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