Required: #6. Question: Bent Company has offered to produce either Alpha or Beta for Rocket Company. Bent Company is a reliable supplier and can offer a supply price for each product that is 160% of Rocket Companys variable cost. Because supplying Rocket Company would require that Bent company adjust production line, it is only willing to supply units of either Alpha or Beta. Should Rocket Company accept the offer to Supply Alpha or Beta and how many units should the company buy to maximize total income? What would be the expected total income?

Rocket Company Rocket Company produces two products: Alpha and Beta. The following table provides information about the two products and budgeted sales for the upcoming year. Rocket Company keeps no finished inventory so production equals sales. Hint: As you work on this exercise remember to consider and let your analysis reflect the machine hours constraint and the maximum sales for each product. Required 1. What is the budgeted income for this planned level of production and sales? ( 0.5 marks) 2. If Rocket Company wants to maintain the product mix in the budget, how many units of each product must it sell to breakeven? Does the company have enough machine minutes capacity for the breakeven production plan? (1 mark) 3. If Rocket Company wants to maintain the product mix in the budget, how many units of each product must it sell to earn projected before tax income of $1,500,000 ? Does the company have enough machine minutes capacity for this production plan? (1 mark) 4. If Rocket Company wants to maintain the product mix in the budget, and given the machine minutes constraint and the sales constraints for Alpha and Beta, what is the maximum number of units of each product that the company should sell, and what would be the expected total income? (1.5 marks) 5. If Rocket Company is prepared to abandon its requirement that the sales mix remain the same as in the current plan, how many units of each product should it sell to maximize income, and what would be the expected total income? (1.5 marks)