2. SM Co has 27,000 labor hours available for producing X and Y. Consider the following information: Product X Product Y Required labor time per unit (hours) 2 DLH 3 DLH Maximum demand (units) 6,000 8,000 Contribution margin per unit $5.00 $6.00 Required: a. What is the best mix given the current situation, i.e. what is the action plan: how many units of each product should be produced under the given circumstances? b. And what is the Total Contribution Margin that is obtained with this mix (i.e. with this action plan)
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