Outdoor Luggage, Incorporated, makes high-end hard-sided luggage for sports equipment. Data concerning three of the company's...
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Outdoor Luggage, Incorporated, makes high-end hard-sided luggage for sports equipment. Data concerning three of the company's most popular models appear below: Ski Guard Golf Guard Fishing Guard Selling price per unit $ 250 Variable cost per unit $ 110 $ 320 $ 210 $350 $ 155 Plastic injection molding machine processing time required to produce one unit Pounds of plastic pellets per unit 14 minutes 9 pounds 13 minutes 10 pounds 20 minutes 14 pounds Required: 1. If the total time available on the plastic injection molding machine is the constraint, how much contribution margin per minute of the constrained resource is earned by each product? 2. Which product offers the most profitable use of the plastic injection molding machine? 3. If a severe shortage of plastic pellets required the company to cut back production so much that its new constraint has become the total available pounds of plastic pellets, how much contribution margin per pound of the constrained resource is earned by each product? 4. Which product offers the most profitable use of the plastic pellets? 5. Which product has the largest contribution margin per unit? Outdoor Luggage, Incorporated, makes high-end hard-sided luggage for sports equipment. Data concerning three of the company's most popular models appear below: Ski Guard Golf Guard Fishing Guard Selling price per unit $ 250 Variable cost per unit $ 110 $ 320 $ 210 $350 $ 155 Plastic injection molding machine processing time required to produce one unit Pounds of plastic pellets per unit 14 minutes 9 pounds 13 minutes 10 pounds 20 minutes 14 pounds Required: 1. If the total time available on the plastic injection molding machine is the constraint, how much contribution margin per minute of the constrained resource is earned by each product? 2. Which product offers the most profitable use of the plastic injection molding machine? 3. If a severe shortage of plastic pellets required the company to cut back production so much that its new constraint has become the total available pounds of plastic pellets, how much contribution margin per pound of the constrained resource is earned by each product? 4. Which product offers the most profitable use of the plastic pellets? 5. Which product has the largest contribution margin per unit?
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Related Book For
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
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