A company has a plant capacity of 19,800 machine hours. The plant can either produce product M or product N or a mixture of both. Following is the relevant information given:
|
|
Product M |
Product N |
|
Selling Price per unit (Rs.) |
20 |
30 |
|
Variable Cost per unit (Rs.) |
30 |
18 |
|
Machine hours required per unit (hrs) |
5 |
3 |
Market conditions are such that not more than 5,000 units of M and 4,000 units of N can be sold in a year. Fixed Costs are Rs. 60,000.
Compute the product mix that will maximize the net income and find that maximum income.