Brinn, located in Port St. Lucie, Florida, produces two lines of electric toothbrushes: deluxe and standard. Because Brinn can sell all the toothbrushes it can produce, 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 4,100 machine hours per month. The plant can manufacture either 50 standard electric toothbrushes or 35 deluxe electric toothbrushes per machine hour.
Requirements
1. Identify the constraining factor for Brinn.
2. Prepare an analysis to show which product line to emphasize?

Transcribed Image Text:

Per Unit Deluxe Standard Toothbrush Toothbrush $ 86 Sales price $ 56 Variable costs 20 18 Contribution margin $ 66 $ 38 Contribution margin ratio 76.7% 67.9%