Problem
Sandel Company makes 2 products, footballs and baseballs. Additional information follows:
|
Footballs
|
Baseballs
|
|
Units
|
4000
|
2500
|
|
Sales
|
$60,000
|
$25,000
|
|
Variable Costs
|
$36,000
|
$7,000
|
|
Fixed Costs
|
$9,000
|
$9,000
|
|
Net Income
|
$15,000
|
$9,000
|
|
Profit per unit
|
$3.75
|
$3.60
|
Instructions
Sandel has unlimited demand for both products but limited resources to produce both products. Therefore, which product should Sandal tell his sales people to emphasize (please cleary show your work on how you reached this conclusion)?