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Brik, located in Port St. Lucie, Florida, produces two lines of electric toothbrushes: deluxe and standard. Because Brik can sell all the toothbrushes it can
Brik, located in Port St. Lucie, Florida, produces two lines of electric toothbrushes: deluxe and standard. Because Brik 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: (Click the icon to view the data.) After expansion, the factory will have a production capacity of 4,200 machine hours per month. The plant can manufacture either 62 standard electric toothbrushes or 26 deluxe electric toothbrushes per machine hour. Read the requirements. Requirement 1. Identify the constraining factor for Brik. Brik's constraint is machine hours Data Table Requirement 2. Prepare a product mix analysis to show which product line to emphasize. Deluxe Standard Per Unit Toothbrushes Toothbrushes Deluxe Standard Toothbrush Toothbrush Sales price $ 80 $ 21 machine hour 48 16 Contribution margin per Variable costs $ 59 $ 32 Contribution margin Contribution margin ratio 73.8% 66.7% Print Done
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