Cache Company manufactures cameras. It has fixed costs of $2,120,000. Cache's sales unit contribution margins and required production time per product are shown below: Assuming that Cache Company has limited production time, with only 1,500 machine hours available per month, assuming that all units produced can be sold, which product should Cache Company manufacture to maximize operating income for the month?

Question

Cache Company manufactures cameras. It has fixed costs of $2,120,000. Cache's sales unit contribution margins and required production time per product are shown below:  Assuming that Cache Company has limited production time, with only 1,500 machine hours available per month, assuming that all units produced can be sold, which product should Cache Company manufacture to maximize operating income for the month?

Quizplus · Accepted Answer

The Answer of Cache Company manufactures cameras. It has fixed costs of $2,120,000. Cache's sales unit contribution margins and required production time per product are shown below:  Assuming that Cache Company has limited production time, with only 1,500 machine hours available per month, assuming that all units produced can be sold, which product should Cache Company manufacture to maximize operating income for the month?

Cache Company Manufactures Cameras