Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem 1. Mookie Betts Corp makes three kinds of long burning scented candles. The Models vary in terms of size and type of materials such
Problem 1. Mookie Betts Corp makes three kinds of long burning scented candles. The Models vary in terms of size and type of materials such as fragrances, decorations, etc. Unit information for Mookie Betts as follows: Candle A Candle B Candle C Sales Price $18.00 $20.00 $24.00 Direct Materials 2.00 1.75 2.25 Direct Labor 2.00 4.00 8.00 Variable Manuf Costs 1.00 1.25 1.25 Fixed Manuf Costs 2.00 2.00 2.50 Required pounds of beeswax 1.5 2.0 2.0 Required labor hours 5.0 6.0 5.0 Mookie has determined that it can sell a limited number of each candle in the upcoming year. Projected demand for these three models are: Candle A 25,000 units Candle B 9,000 units Candle C 18,000 units Required: 1. Suppose that disease in the supplies hive has severely restricted the production of beeswax. Thus, beeswax has been identified as a bottleneck. Determine how Mookie should prioritize production by rank ordering the products 1 to 3. 2. If only 65,000 pounds of beeswax is available, calculate the units of each candle that Mookie should produce to maximize profit. 3. The number of labor hours that has been identified as the most constrained resource. Determine how Mookie should prioritize production by rank ordering the products 1 to 3. 4. If only 240,000 direct labor hours are available, calculate the units of each candle that Moolkie should produce to maximize profit. 5. Which one of these constraints would produce the higher contribution margin? Which one of the bottlenecks would you choose to maximize profits? Why
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started