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Southern production company has 100 labor-hours available

Question - Southern Production Company has 100 labor-hours available. There is no limit on machine-hours. Southern can sell all of B it wants, but it can only sell 45 units and 20 units of A and C, respectively.

Product A Product B Product C

Contribution margin per unit $15 $10 $12

Labor-hours per unit 2 2.5 2

Machine-hours per unit 5 4 1

a) What is the contribution margin per labor-hour for Product A?

b) What is the contribution margin per labor-hour for Product B?

c) What is the contribution margin per labor-hour for Product C?

d) How many units of Product A should the company make?

e) How many units of Product B should the company make?

f) How many units of Product C should the company make?

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Accounting Basics: Southern production company has 100 labor-hours available

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