Question
9.SixthZ can make three different types of cornhole boards - custom boards, mass-produced boards, and mini-boards. Data for these types of boards is given in
9.SixthZ can make three different types of cornhole boards - custom boards, mass-produced boards, and mini-boards. Data for these types of boards is given in the table below. SixthZ is constrained by the number of employees it can find to paint the boards.
Custom Boards | Mass-Produced Boards | Mini Boards | |
Selling Price Per Set | $125 | $110 | $75 |
Direct Materials Per Set | $25 | $25 | $15 |
Direct Labor Per Set ($15/hr) | $30 | $22.50 | $12 |
VMO Per Set ($2 per Direct Labor hour) | $4 | $3 | $2 |
FMO Per Set | $10 | $10 | $10 |
Variable Selling & Administrative Expenses Per Set | $3 | $2 | $1 |
Fixed Selling & Administrative Expenses Per Set | $5 | $2 | $2 |
Assuming that direct labor hours are limited, which model is the most profitable to produce?
Group of answer choices
Custom Boards
SixthZ does not have enough information to make this decision
Mass-Produced Boards
Mini Boards
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