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How many of each product should Sandhill Co produce

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

 

A

B

C

Sales

$3.00

$6.00

$13.00

Variable costs

$1.20

$3.40

$8.00

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

700

650

250

The company has only 1,600 direct labor hours available to commit to production of any new products.

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

Reference no: EM133090947

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