Sugar manufactures four types of Chocolate: White, Milk , Semisweet and Dark. The following budgeted figures have
Question:
Sugar manufactures four types of Chocolate: White, Milk , Semisweet and Dark. The following budgeted figures have been produced for the month of May 2021:
| White | Milk | Semisweet | Dark |
Demand | 4,000 | 1,000 | 1,800 | 1,860 |
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Selling Price per Unit | 11.25 | 22.00 | 15.56 | 17.20 |
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Material | 2.50 | 8.00 | 6.11 | 5.38 |
Labour | 3.00 | 7.0 | 4.45 | 2.12 |
Variable Overhead | 0.75 | 2.00 | 1.67 | 1.34 |
Fixed Overhead | 1.75 | 5.00 | 2.78 | 2.15 |
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Labour is paid at $10 per hour and is limited to 2,500 hours for the month of May.
(a) Determine the number of hours required to complete the above-mentioned budgeted production.
Indicate the number of hours that are not available.
(b) Determine the profitability order of the four products using labor hours as the limiting factor of production.
(c) Determine the production mix that will maximize profit over the period.
Expert Answer:
a To determine the number of hours required to complete the budgeted production we need to calculate the total number of labor hours required for each ... View the full answer
