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Requirements Data Table 1. What is the constraining factor at Mike's Beach Hut? What should Mike stock to maximize profits? What is the maximum contribution
Requirements Data Table 1. What is the constraining factor at Mike's Beach Hut? What should Mike stock to maximize profits? What is the maximum contribution margin he could generate from refrigerated drinks each day? 2. To provide variety to customers, suppose Mike refuses to devote more than 75 linear feet and no less than 10 linear feet to any individual product. Under this condition, how many linear feet of each drink should be stocked? How many units of each product will be available for sale each day? 3. Assuming the product mix calculated in Requirement 2, what contribution margin will be generated from refrigerated drinks each day? The beverage stand sells three types of cold drinks: 1. Grand - Cola in 12-oz. cans for $1.40 per can 2. Energy Drink in 20-oz. plastic bottles for $1.75 per bottle 3. Right - Cola in 20-oz. glass bottles for $2.25 per bottle Mike's Beach Hut pays its suppliers the following: 1. $0.15 per 12-oz. can of grand-cola 2. $0.30 per 20-oz. bottle of energy drink 3. $0.75 per 20-oz. bottle of right-cola Mike's Beach Hut's monthly fixed expenses include the following: Hut rental.. $ 360 Print Done 70 1,800 Refrigerator rental Mike's salary $ Total fixed expenses .... imber in the input fields and then click Check Answer. 2,230 Clear All Print Done Each morning, Mike Root stocks the drink case at Mike's Beach Hut in Charlotte, North Carolina. Mike's Beach Hut has 130 linear feet of refrigerated display space for cold drinks. Each linear foot can hold either five 12-ounce cans or four 20-ounce plastic or glass bottles. (Click the icon to view the information on the cold drinks.) The beverage stand can sell all drinks stocked in the display case each morning. Read the requirements. Requirement 1. What is the constraining factor at Mike's Beach Hut? What should Mike stock to maximize profits? What is the maximum contribution margin he could generate from refrigerated drinks each day? The constraining factor is linear feet of shelf space Mike's should stock the drink with the highest contribution margin. Complete the product mix analysis to determine which product would maximize Mike's profits. Mike's Beach Hut Product Mix Analysis energy drink right-cola grand-cola 12 oz. Cans 20 oz. Bottles 20 oz. Bottles
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