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1) Calculate total contribution margin for both scenarios (ie. chairs and tables) in the table below: making the tables first? or making the chairs first,
1) Calculate total contribution margin for both scenarios (ie. chairs and tables) in the table below: making the tables first? or making the chairs first, up to total demand.
2) Calculate/Prove out which scenario (ie. chairs? or tables?) is more proftable.
Note: Using excel, Show all calculations on CM per unit of the constrained resource, show all formulas used, and show all cell references.
Constrained Resource Problem | ||
Chairs | Tables | |
Selling price per unit | $80 | $400 |
Variable cost per unit | $30 | $200 |
Board feet per unit | 2 | 10 |
Monthly demand | 600 | 100 |
Board feet available per month = 2000 |
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