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How many of each product should Carla Vista Co produce

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Reference no: EM133040013

Question - Carla Vista Co. is considering the introduction of three new products. Per unit sales and cost information are as follows:

 

A

B

C

Sales

$3.00

$5.00

$14.00

Variable costs

$1.20

$3.40

$7.00

Fixed costs

$0.50

$1.00

$3.50

Labor hours per unit

0.75 hours

1.25 hours

2.00 hours

Monthly demand in units

800

650

250

The company has only 1,700 direct labor hours available to commit to production of any new products.

Required - How many of each product should Carla Vista Co. produce and sell to maximize its profit?

Reference no: EM133040013

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