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Easton Corporation makes two different boat anchors a traditional fishing anchor and a high - end yacht anchor using the same production machinery. The contribution
Easton Corporation makes two different boat anchorsa traditional fishing anchor and a highend yacht anchorusing the same production machinery. The contribution margin of the yacht anchor is three times as high as that of the other product. The company is currently operating at full capacity and has been doing so for nearly two years. Bjorn Borg, the companys CEO, wants to cut back on production of the fishing anchor so that the company can make more yacht anchors. He says that this is a nobrainer because the contribution margin of the yacht anchor is so much higher. Instructions
Write a short memo to Bjorn Borg describing the analysis that the company should do before it makes this decision and any other considerations that would affect the decision.
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