Heft Company produces A and B with contribution margins per unit of $40 and $30, respectively. Only 500 labour hours and 300 machine hours are available for production.
Time requirements to produce one unit of A and B are as follows:
$$\begin{array} { l c c c }
& \text { Product A } & \text { Praduct B } \
\text { Labour hours per unit }& 5 & 2 \
\text { Machine hours per unit } & 1 & 4
\end{array}$$
-Refer to the figure.What is the objective function to maximize profits for Heft Company?
A)Maximize 1A + 4B
B)Minimize 5A + 2B
C)Maximize 40A + 30B
D)Minimize 40A + 30B

Question

Heft Company produces A and B with contribution margins per unit of $40 and $30, respectively. Only 500 labour hours and 300 machine hours are available for production.
Time requirements to produce one unit of A and B are as follows:
$$\begin{array} { l c c c } 
 & \text { Product A } & \text { Praduct B } \
\text { Labour hours per unit }& 5 & 2 \
\text { Machine hours per unit }  & 1 & 4
\end{array}$$
-Refer to the figure.What is the objective function to maximize profits for Heft Company?
A)Maximize 1A + 4B
B)Minimize 5A + 2B
C)Maximize 40A + 30B
D)Minimize 40A + 30B

Quizplus · Accepted Answer

The objective function to maximize profits for Heft Company involves maximizing the total contribution margin, which is $40 per unit for Product A and $30 per unit for Product B. Therefore, the objective function is to maximize the total contribution margin, represented as 40A + 30B, where A and B are the quantities of Product A and B, respectively.

Heft Company Produces a and B with Contribution Margins Per