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Determining the optimal Product Mix with One Constrained Resource and a Sales Constraint Comfy Fit Company manufactures two types of university sweatshirts, the Swoop and
Determining the optimal Product Mix with One Constrained Resource and a Sales Constraint Comfy Fit Company manufactures two types of university sweatshirts, the Swoop and the Rufus, with unit contribution margins of $5 and $15, respectively. Regardless of type, each sweatshirt must be fed through a stitching machine to affix the appropriate university logo. The firm leases seven machines that each provides 1,000 hours of machine time per year. Each Swoop sweatshirt requires 6 minutes of machine time, and each Rufus sweatshirt requires 30 minutes of machine time. Assume that a maximum of 52,500 units of each sweatshirt can be sold. Required: If required, round your answers to the nearest whole number. 1. What is the contribution margin per hour of machine time for each type of sweatshirt? Contribution Margin Swoop $ 50 30 Rufus $ 2. What is the optimal mix of sweatshirt? Optimal Mix Swoop 52,500 units 10,000 x units Rufus 3. What is the total contribution margin earned for the optimal mix? $ 52,500 x
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