8. Pebbles Limited manufactures three beers: Light, Medium and Hard. Mediu Hard m 180 60 $6...

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8. Pebbles Limited manufactures three beers: Light, Medium and Hard. Mediu Hard m 180 60 $6 10 Selling price Variable costs Direct labour hour rate per unit Machine hours per unit Product Light Medium Hard Light Demand 10,000 12,000 8,000 120 60 $10 6 200 100 Demand for the products are as follows, while machine hours are limited to 300,000 and labour hours to 100,000 hours: $5 12 Direct labour costs per unit are 50% of variable costs per unit. Variable costs include direct material and direct labour. Fixed costs for the period amounted to $1,750,000. Required: a. Determine the optimal product mix b. Determine the optimal profit c. What might cause an entity not to produce all products demanded? Limiting factor analysis 8. Pebbles Limited manufactures three beers: Light, Medium and Hard. Mediu Hard m 180 60 $6 10 Selling price Variable costs Direct labour hour rate per unit Machine hours per unit Product Light Medium Hard Light Demand 10,000 12,000 8,000 120 60 $10 6 200 100 Demand for the products are as follows, while machine hours are limited to 300,000 and labour hours to 100,000 hours: $5 12 Direct labour costs per unit are 50% of variable costs per unit. Variable costs include direct material and direct labour. Fixed costs for the period amounted to $1,750,000. Required: a. Determine the optimal product mix b. Determine the optimal profit c. What might cause an entity not to produce all products demanded? Limiting factor analysis

Answer rating: 100% (QA)

a Determine the optimal product mix The optimal product mix is to produce 10000 units of Light beer and 8000 units of Medium beer This is because the ... View the full answer