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In: Accounting

Avanti Ltd produces two mixers. Stand mixer and hand mixer. The selling price of a Stand...

Avanti Ltd produces two mixers. Stand mixer and hand mixer. The selling price of a Stand mixer is $500, and the selling price of a hand mixer is $150. The variable cost per unit for the stand mixer is $300 and the variable cost per unit of the hand mixer is $ 100. The direct labour hour requirement and demand for the two products are:

stand mixer Hand mixer
Monthly demand 500 1000
Direct Labour hour required per unit 2.5 hours 1.5 hours

Avanti Ltd's production capacity is 1500 direct labour hours. The optimal profit that Avanti can get from these products is :

$ 108, 300

$ 128, 300

$ 100,000

None of the above


What is the correct option?

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Expert Solution


ekkarill92 answered 1 year ago
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