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.

Required

1. What is the budgeted income for this planned level of production and sales?

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?

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?

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 income?

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?

	Alpha	Beta	Total
Maximum Unit Sales	160,000	130,000	290,000
Planned Unit Sales	140,000	110,00	250,000
Price Per Unit	$25.00	$40.00
Variable Cost Per Unit	$15.00	$25.00
Fixed Costs			$2,000,000
Machine Capacity (Minutes)			3,000,000
Machine Minutes Per Unit	9	14