Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Determining the Optimal Product Mix with One Constrained Resource and a Sales Constraint Casual Essentials, Inc. manufactures two types of team shirts, the Homerun and
Determining the Optimal Product Mix with One Constrained Resource and a Sales Constraint Casual Essentials, Inc. manufactures two types of team shirts, the Homerun and the Goalpost, with unit contribution margins of $5 and $15, respectively. Regardless of type, each team shirts must be fed through a stitching machine to affix the appropriate team logo. The firm leases seven machines that each provides 1,000 hours of machine time per year. Each Homerun shirt requires 6 minutes of machine time, and each Goalpost shirt requires 30 minutes of machine time. Assume that a maximum of 48,690 units of each team shirts 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 team shirts? Contribution Margin Homerun Goalpost 2. What is the optimal mix of team shirts? Optimal Mix Homerun Goalpost 3. What is the total contribution margin earned for the optimal mix? units
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started