Question
Mountain Vista Spa offers three types of massagesShiatsu (price $625; variable cost $100), Aromatherapy (price $525; variable cost $150), and Hot Stone (price $650; variable
Mountain Vista Spa offers three types of massagesShiatsu (price $625; variable cost $100), Aromatherapy (price $525; variable cost $150), and Hot Stone (price $650; variable cost $200). Mountain Vista has eight salaried masseuses, each of whom works a total of 1,000 hours per year. All eight masseuses are trained to provide all three massage types. Each Shiatsu massage requires 180 minutes of masseuse time, each Aromatherapy massage requires 75 minutes of masseuse time, and each Hot Stone massage requires 120 minutes of masseuse time. Variable costs per massage consist solely of towels, robes, oils, candles, stones, and room cleanup. Also, based on recent market research of the resort community in which Mountain Vista Spa operates, its management is confident that it can annually sell a maximum of 1,000 Shiatsu massages, 4,000 Aromatherapy massages, and 1,200 Hot Stone massages. There are no other constraints.
Required:
Do not round intermediate calculations.
A. The contribution margin per unit for each massage type is as follows:
Shiatsu: | $fill in the blank 1 |
Aromatherapy: | $fill in the blank 2 |
Hot Stone: | $fill in the blank 3 |
B. The contribution margin per hour of masseuse time for each massage type is as follows:
Shiatsu: | $fill in the blank 4 |
Aromatherapy: | $fill in the blank 5 |
Hot Stone: | $fill in the blank 6 |
C. The optimal mix of massage types is as follows:
Shiatsu: | fill in the blank 7 |
Aromatherapy: | fill in the blank 8 |
Hot Stone: | fill in the blank 9 |
D. Mountain Vista Spa's total contribution margin earned for the optimal mix is $fill in the blank 10.
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