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Outdoor Luggage Inc. makes high-end hard-sided luggage for sports equipment. Data concerning three of the companys most popular models appear below. Ski Guard Golf Guard

Outdoor Luggage Inc. makes high-end hard-sided luggage for sports equipment. Data concerning three of the companys most popular models appear below.

Ski Guard Golf Guard Fishing Guard

Selling price per unit $310 $340 $265

Variable cost per unit $80 $140 $115

Plastic injection molding machine processing time required to produce one unit 5 minutes 6 minutes 3 minutes

Pounds of plastic pellets per unit 6 pounds 15 pounds 6 pounds

Required:

1a.
The total time available on the plastic injection molding machine is the constraint in the production process. What is the contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?

1b. Which product would be the most profitable use of this constraint?

Fishing Guard

Golf Guard

Ski Guard

1c. Which product would be the least profitable use of this constraint?

Fishing Guard

Golf Guard

Ski Guard

2a.
A severe shortage of plastic pellets has required the company to cut back its production so much that the plastic injection molding machine is no longer the bottleneck. Instead, the constraint is the total available pounds of plastic pellets. What is contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?

2b. Which product would be the most profitable use of this constraint?

Ski Guard

Golf Guard

Fishing Guard

2c. Which product would be the least profitable use of this constraint?

Ski Guard

Golf Guard

Fishing Guard

3. Which product has the largest unit contribution margin?

Ski Guard

Fishing Guard

Golf Guard

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Previous Question Next Question

	Ski Guard		Golf Guard		Fishing Guard
Selling price per unit		$310		$340		$265
Variable cost per unit		$80		$140		$115
Plastic injection molding machine processing time required to produce one unit		5 minutes		6 minutes		3 minutes
Pounds of plastic pellets per unit		6 pounds		15 pounds		6 pounds

Required:
1a.	The total time available on the plastic injection molding machine is the constraint in the production process. What is the contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?

2a.	A severe shortage of plastic pellets has required the company to cut back its production so much that the plastic injection molding machine is no longer the bottleneck. Instead, the constraint is the total available pounds of plastic pellets. What is contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?