Question
Need some help with a contribution margin problem. Thank you. VOTA, Inc. produces three products but weekly demand for the three products exceeds the available
Need some help with a contribution margin problem. Thank you. VOTA, Inc. produces three products but weekly demand for the three products exceeds the available amount of machine time. The demand and machine hour information about each product is provided below: Product A Product B Product C Contribution Margin per unit $300 $400 $150 Machine Hours per unit 3 2 0.50 Weekly Demand (units) 100 300 800 (a.) Determine how many units each of Product A, Product B, and Product C that Marshall, Inc., should produce each week assuming 1,100 hours of available machine time. To assign the 1,000 available machine hours to achieve the most profitable mix of products, start by producing the product with the highest contribution per machine hour, then the next highest, and so on. Step 1: Use 400 machine hours to produce Product C. Step 2: Use the remaining 600 machine hours to produce Product B. Note that with only 1,000 machine hours available, given the current demand for each product, Product A would not be included in the production mix.
Problem 4 VOTA, Inc. produces three products but weekly demand for the three products exceeds the available amount of machine time. The demand and machine hour information about each product is provided below: (a.) Determine how many units each of Product A, Product B, and Product C that Marshall, Inc., should produce each week assuming 1,100 hours of available machine time. To assign the 1,000 available machine hours to achieve the most profitable mix of products, start by producing the product with the highest contribution per machine hour, then the next highest, and so on. Step 1: Use 400 machine hours to produce Product C. Step 2: Use the remaining 600 machine hours to produce Product B. Note that with only 1,000 machine hours available, given the current demand for each product, Product A would not be included in the production mix. 1Step by Step Solution
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