Knoxville Manufacturing Company produces X and Y with contribution margins per unit of $10 and $90, respectively. Only 200 labor hours and 400 machine hours are available for production. Time requirements to produce one unit of X and Y are as follows:
What is the constraint on machine hours for Knoxville Manufacturing Company?
A) 10X + 90Y £ 200
B) 1X + 2Y £ 400
C) 5X + 1Y £ 400
D) 1X + 2Y £ 200

Question

Knoxville Manufacturing Company produces X and Y with contribution margins per unit of $10 and $90, respectively. Only 200 labor hours and 400 machine hours are available for production. Time requirements to produce one unit of X and Y are as follows:
 What is the constraint on machine hours for Knoxville Manufacturing Company?
A) 10X + 90Y £ 200 
B) 1X + 2Y £ 400 
C) 5X + 1Y £ 400 
D) 1X + 2Y £ 200

Quizplus · Accepted Answer

The constraint on machine hours is expressed as:
5X + 1Y ≤ 400
This is because producing one unit of X requires 5 machine hours and one unit of Y requires 1 machine hour, and the total available machine hours are limited to 400. This is the most restrictive constraint, as it limits the production of both X and Y. Therefore, the best choice is C.

Knoxville Manufacturing Company Produces X and Y with Contribution Margins