Star Company produces and sells two products, J and R. Revenue and cost information for the two products from last month is given below: selling price per unit variable costs per unit Product J $14.90 $ 5.30 Product R $15.80 $ 8.70 Each month Star Company has 60,000 direct labor hours available and 72,000 machine hours available. Product J requires 8 direct labor hours for each unit and 4 machine hours for each unit. Product R requires 6 direct labor hours for each unit and 9 machine hours for each unit. For the coming month, Star Company would like to use linear programming in order to maximize its monthly profits. Calculate the number of units of Product J that should be produced in order to maximize net income.

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Chapter6: Activity-based, Variable, And Absorption Costing
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Star Company produces and sells two products, J and R. Revenue
and cost information for the two products from last month is
given below:
selling price per unit
variable costs per unit
Product J
$14.90
$ 5.30
Product R
$15.80
$ 8.70
Each month Star Company has 60,000 direct labor hours available
and 72,000 machine hours available. Product J requires 8 direct
labor hours for each unit and 4 machine hours for each unit.
Product R requires 6 direct labor hours for each unit and 9
machine hours for each unit.
For the coming month, Star Company would like to use linear
programming in order to maximize its monthly profits.
Calculate the number of units of Product that should be
produced in order to maximize net income.
Transcribed Image Text:Star Company produces and sells two products, J and R. Revenue and cost information for the two products from last month is given below: selling price per unit variable costs per unit Product J $14.90 $ 5.30 Product R $15.80 $ 8.70 Each month Star Company has 60,000 direct labor hours available and 72,000 machine hours available. Product J requires 8 direct labor hours for each unit and 4 machine hours for each unit. Product R requires 6 direct labor hours for each unit and 9 machine hours for each unit. For the coming month, Star Company would like to use linear programming in order to maximize its monthly profits. Calculate the number of units of Product that should be produced in order to maximize net income.
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