Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Leach Finishing makes various metal fittings for the construction Industry. Three of the fittings, models X-12, X-24, and X-30, require grinding on a patented

image

Leach Finishing makes various metal fittings for the construction Industry. Three of the fittings, models X-12, X-24, and X-30, require grinding on a patented machine of which Leach has only one. The cost of production Information for the three products follow: Price per fitting Variable cost per fitting Units per hour of grinding X-12 X-24 X-30 $ 28 $ 44 $ 63 $ 13 $ 20 $ 37 18.0 12.5 10.0 The testing machine used for both models has a capacity of 2,810 hours annually. Fixed manufacturing costs are $482,000 annually. Required: a. Suppose that Leach Finishing can sell at most 55,000 units of any one fitting. How many units of each fitting model should Leach Finishing produce annually? b. Suppose that Leach Finishing can sell at most 14,850 units of any one fitting. How many units of each fitting should Leach Finishing produce annually? Complete this question by entering your answers in the tabs below. Required A Required B Suppose that Leach Finishing can sell at most 55,000 units of any one fitting. How many units of each fitting model should Leach Finishing produce annually? X-12 X-24 units units X-30 units < Required A Required B >

Step by Step Solution

3.42 Rating (171 Votes )

There are 3 Steps involved in it

Step: 1

To determine the optimal production quantity for each fitting model we need to calculate the contribution margin per hour of grinding and then divide the total available grinding hours by the contribu... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Labor and Employment Law Text and Cases

Authors: David Twomey

15th edition

1133188281, 978-1133711841, 1133711847, 978-1285247632, 978-1133188285

More Books

Students also viewed these Accounting questions

Question

What is the meaning and definition of E-Business?

Answered: 1 week ago