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SHOW ALL WORK AND EXPLANATIONS S25-5 (similar to) Question Help Storage Solutions produces plastic storage bins for household storage needs. (Click the icon to view
SHOW ALL WORK AND EXPLANATIONS
S25-5 (similar to) Question Help Storage Solutions produces plastic storage bins for household storage needs. (Click the icon to view additional information.) Sales prices and variable costs are as follows: (Click the icon to view the costs.) Read the requirements. Storage Solutions Product Mix Analysis Regular Large Sales price per unit Variable cost per unit Contribution margin per unit Units per machine hour Contribution margin per machine hour Enter any number in the edit fields and then click Check Answer. The company makes two sizes of bins: large (50 gallon) and regular (35 gallon). Demand for the products is so high that Storage Solutions can sell as many of each size as it can produce. The company uses the same machinery to produce both sizes. The machinery can only be run for 3,300 hours per period. Storage Solutions can produce 11 large bins every hour, whereas it can produce 17 regular bins in the same amount of time. Fixed costs amount to $90,000 per period. Regular Large Sales price per unit $ 9.00 $ 10.70 Variable costs per unit 3.10 4.40 1. Which product should Storage Solutions emphasize? Why? 2. To maximize profits, how many of each size bin should Storage Solutions produce? 3. Given this product mix, what will the company's operating income beStep by Step Solution
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