A Company Sells Two Products with Information as Follows The Products Are Machine Made

question 82

Multiple Choice

A company sells two products with information as follows: $$\begin{array} { | l | c | c | } \hline & \mathrm { A } & \mathrm { B } \\\hline \text { Sales price per unit } & \$ 12.00 & \$ 26.00 \\\hline \text { Variable cost per unit } & \$ 10.00 & \$ 12.00 \\\hline\end{array}$$ The products are machine made.Four 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 a maximum of 6000 machine hours available per month.The company can sell up to 18,000 units of product A per month,and up to 3000 units of product B for the month.What is the optimum product mix to maximize the company's operating income?

• A) 1500 units of A and 78,000 units of B
• B) 18,000 units of A and 3000 units of B
• C) zero units of A and 3000 units of B
• D) 36,000 units of A and zero units of B

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