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Ridley Corporation Manufactures Two Styles of Lamps-A Bedford Lamp and a Lowell

Question 112

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Ridley Corporation manufactures two styles of lamps-a Bedford Lamp and a Lowell Lamp.The following per unit data are available:
Ridley Corporation manufactures two styles of lamps-a Bedford Lamp and a Lowell Lamp.The following per unit data are available:   Total fixed costs are $40,000.Marketing data indicate that the company can sell up to 8,000 units of the Bedford Lamp and up to 4,000 units of the Lowell Lamp.Machine hour capacity is 26,000 hours per year.Which product mix will deliver the optimum operating income? A) 8,000 Bedford Lamps and 4,000 Lowell Lamps B) 4,000 Bedford Lamps and zero Lowell Lamps C) 8,000 Bedford Lamps and 2,500 Lowell Lamps D) 4,000 Bedford Lamps and 1,000 Lowell Lamps
Total fixed costs are $40,000.Marketing data indicate that the company can sell up to 8,000 units of the Bedford Lamp and up to 4,000 units of the Lowell Lamp.Machine hour capacity is 26,000 hours per year.Which product mix will deliver the optimum operating income?


A) 8,000 Bedford Lamps and 4,000 Lowell Lamps
B) 4,000 Bedford Lamps and zero Lowell Lamps
C) 8,000 Bedford Lamps and 2,500 Lowell Lamps
D) 4,000 Bedford Lamps and 1,000 Lowell Lamps

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