Homework: Chapter 8 - Homework Score: 0.33 of 2 pts % 58-10 (book/static) Storage Solutions produces plastic storage bins for household storage needs. The company makes two s machinery is used to produce both sizes. The machinery is available for only 3,000 hours per period. The (Click the icon to view the product mix analysis.) Click the icon to view the operating income fro Assume that demand for Regular bins is limited to 36,000 units and demand for Large bins is limited to 25 1. How many of each size bin should the company make now? 2. Given this product mix, what will be the company's operating income? 3. Explain why the operating income is less than it was when the company was producing its optimal pri 1. How many of each size bin should the company make now? This is a product mix decision. First determine which bin size Storage Solutions should emphasize. Storage Solutions should emphasize the production of regular size bins since they are more profitablett Decision: Storage Solutions should produce 36,000 regular size bins and 6,000 large size bins. 2. Given the product mix determined above, calculate the company's operating income. Storage Solutions Operating Income from Product Mix Regular Large Total Number of bins per period Total contribution margin Less: Operating income Choose from any list or enter any number in the input fields and then click Check Answer. 1 part remaining 5 of 11 (9 complete) HW Score: 39.24%, 785 of 20 pts Question Help ompany makes two sizes of bins: Large (50 gallon) and Regular (35 gallon). Demand for the product used to be so high that the company could sell as many of each size as could produce. The same ours per period. The company can produce 10 Large bins every hour compared to 15 Regular bins in the same amount of time. Foed expenses amount to $110.000 per period Product mix data follows operating income from the optimal product mix) bins is limited to 25,000 units ducing its optimal product mix ald emphasize are more profitable than the large size bins 6,000 large size bins. ne Total Reference . X Reference -X Storage Solutions Product Mix Analysis Regular S 8.10 3.50 Sales price per unit Less: Variable cost per unit Contribution margin per unit Large $ 10.50 4.20 Storage Solutions Operating Income from Optimal Product Mix Number of bins per period 45,000 Contribution margin per bin S 4.60 Total contribution margin $ 207.000 Less: Fixed expenses 110,000 $ 97,000 Operating income 4.60 15 Units per machine hour 6.30 10 M Contribution margin per machine hour 69.00 $ 63.00 Print Done Print Done