Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question 1 ACME Widgets produces three products: widgets A, B, and C. The following information is available for each product: Product A B C
Question 1 ACME Widgets produces three products: widgets A, B, and C. The following information is available for each product: Product A B C Selling price per unit $10.00 $15.00 $20.00 Direct material cost per unit $2.00 $3.00 $4.00 Production time per unit on the bottleneck machine 4 hours 3 hours Question 3: Breakeven Point Analysis 2 hours The company has 1,200 hours of capacity available on the bottleneck machine each month. The company's management team wants to determine the most profitable mix of products to produce. Fixed operating costs are equal to $3,000. ACME Widgets utilizes throughput accounting principles. Maximum demand for products is: A-250 units, B-200 units, C-150 units. Question 1: Contribution Margin Analysis Question: Which product has the highest contribution margin per unit, and what is its value? a. Product A - $6.00 b. Product C-$16.00 c. Product C-$12.00 d. Product B - $10.00 Question 2: Optimal Product Mix Question: What is the optimal production mix to maximize total throughput, considering the de constraints? a. Produce 200 units of A, 150 units of B, and 150 units of C. b. Produce 250 units of A, 100 units of B, and 100 units of C. c. Produce 75 units of A, 200 units of B, and 150 units of C. d. Produce 100 units of A, 250 units of B, and 150 units of C.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Question 1 The contribution margin per unit for each product is calculated by subtracting the direct ...Get Instant Access to Expert-Tailored 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