Bolton Dental Manufacturer, located in Cambridge, produces two lines of electric tooth- brushes: Deluxe and Standard. Because Bolton can sell all of the toothbrushes it produces, the owners are expanding the plant. They are deciding which product line to emphasize. To make this decision, they assemble the following data:

After expansion, the factory will have a production capacity of 4,500 machine hours per month. The plant can manufacture either 60 Standard electric toothbrushes or 24 deluxe electric toothbrushes per machine hour.
Requirements
1. Identify the constraining factor for Bolton.
2. Prepare an analysis to show which product line to emphasize.

Transcribed Image Text:

Per Unit DeluxeStandard Toothbrush Toothbrush $80 Sale price Variable expenses. Contribution margin Contribution margin ratio $48 18 $30 S60 7590 62.5%