Question: (b) AB Ltd makes two products the Easy pack & Tight well. Unit variable cost are as follows. Easy pack $ Tight well $ 6

 (b) AB Ltd makes two products the Easy pack & Tight

(b) AB Ltd makes two products the Easy pack & Tight well. Unit variable cost are as follows. Easy pack $ Tight well $ 6 2 12 4 Direct material Direct labour ( $4 per labour hour) Variable overhead Total 3 3 17 13 Unit selling price per unit is $23 for each Easy Pack produced and $17 for each unit Tight well produced. The Procurement Director informed that the available direct labour for July is limited to 8,000 hours and that sales demand in July is expected to be 3,000 units for Easy pack and 5,000 units for Tight well REQUIRED Determine the profit-Maximising mix, assuming that monthly fixed costs are $20,000 and that opening stock of finished goods &WIP are nil. [10 marks]

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