PA7-6 Making Decisions Involving Constrained Resource [LO 7-2, 7-7]

PA7-6 Making Decisions Involving Constrained Resource [LO 7-2, 7-7] Blossom, Inc., is a small company that manutactures three versions ot patio tables. unit information for its products follows: Sales price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Required number of labor hours Required number of machine hours Table A $ 42 7 2 7 0.5 Table 8 s 46 8 3 2 7 0.5 2.50 Table C s 60 9 7 2 7 1.0 2.0 Blossom has determined that it can sell a limited number of each table in the upcoming year. Expected demand for each model follows: Table A Table 8 Table C Required: 50,000 30,000 20,000 units units units 1. Suppose that direct labor nours nas been identified as the bottleneck resource. Determine now Blossom should prioritize production by rank ordering the products trom 1 to 3. n ki Table A Table 8 Table C 2. If Blossom nas only 45,000 direct labor nours available, calculate the number ot units ot each table that alossom should produce to maximize its profit (Enter the products in the sequence ot their preferences; the product with first preference should be entered first.) uct Units Produce