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Santora Company manufactures two productslong dash—toaster ovens and bread machines. The following data are​ available:
- Toaster Ovens Bread Machines
Sales price $ 60 $150
Variable costs $ 50 $ 60
Santora can manufacture six toaster ovens per machine hour and four bread machines per machine hour.​ Santora's production capacity is 2,0002 machine hours per​ month, and it can sell as many units of either type as it can produce.
Which product and how many units should the company produce in a month to maximize​ profits? (Round machine hour per unit to two decimal places and your final answer to the nearest whole​ dollar.)

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Answer:

Thus to maximize profit, Santora Company should manufacture Bread machine only.

The unit of Bread machine can be produced in 2,000 machine hours is 8,000 units

Explanation:

The profit for Toaster Ovens and Bread Machines is $10 and $90 respectively; thus  

six toaster ovens per machine hour will generate profit of $60 = ($10 *6)

four bread machines per machine hour  will generate profit of $360 = ($90 *4)

In the same machine hour the profit from Bread machines are significantly higher then Toaster over. Thus to maximize profit, Santora Company should manufacture Bread machine only.

The unit of Bread machine can be produced in 2,000 machine hours is 8,000 units (= 2,000 * 4)

The profit for 8,000 units of Bread machine is $720,000 = (8,000 * $90)

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