Question
In addition to making hand sanitizer, Sanitex Inc. also manufactures three different models of facemasks used in the health care industry. Because of the Covid-19
In addition to making hand sanitizer, Sanitex Inc. also manufactures three different models of facemasks used in the health care industry. Because of the Covid-19 pandemic, the demand for all three models of masks will remain strong. For the upcoming month, the manager of operations estimates that Wovex the special fabric used in making all three masks, will be in short supply. According to the production managers estimates, Sanitex will only be able to secure 5,000 meters of the fabric for the next month of production. The purchase price for Wovex is $80.00 per meter. Information relating to the manufacturing and sales of the three models of facemasks follows:
| X1 Basic Model | X2 Better Model | X3 Best Model |
Estimated Monthly Demand | 50,000 units | 75,000 units | 150,000 units |
Unit Selling Price | $5.75 | $8.20 | $10.25 |
Unit Manufacturing Costs: |
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Wovex - Direct Material | $2.00 | $3.60 | $4.80 |
Direct Labor | $0.75 | $0.90 | $1.05 |
Variable MOH | $1.50 | $1.80 | $2.10 |
Total Variable Unit Cost | $4.25 | $6.30 | $7.95 |
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Note to students: Answer the question in the Excel worksheet template under the tab Question 3 provided by your instructor.
Required:
Determine how many units of each type of masks that Sanitex should make for the upcoming month.
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