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Sienna's Shades produces standard and deluxe sunglasses: (Click the icon to view the information.) The company has 16,000 machine hours available. In one machine
Sienna's Shades produces standard and deluxe sunglasses: (Click the icon to view the information.) The company has 16,000 machine hours available. In one machine hour, Sienna's can produce 40 pairs of the standard model or 10 pairs of the deluxe model. Read the requirements. Requirement 1. Which model should Sienna's emphasize? First, calculate the total contribution margin at full capacity for each model. Select the labels and calculate the contribution margin at capacity for the standard model, then the deluxe model. Less: Contribution margin per pair Contribution margin per machine hour Capacity- Total contribution margin at full capacity Standard Deluxe Data table Standard Deluxe Sales price per pair $ 18 $ 28 Variable expenses per pair 12 22 Which model should Sienna's emphasize? model. Sienna's should emphasize the Requirement 2. Sienna's also p analyze the alternatives. What is First, complete the following tabl standard uct: sport sunglasses. Review the c ction? Buy Sunglasses deluxe Facilities Make Othe Sienna's Shades produces standard and deluxe sunglasses: Requirement 2. Sienna's also produces a third product: sport sunglasses. Review the cost and other information related to this product. Identify and analyze the alternatives. What is the best course of action? First, complete the following table. Relevant Costs: Direct materials Direct labor Variable overhead Fixed overhead. Purchase cost Total cost of obtaining sunglasses Profit from other products Net cost of obtaining sunglasses Buy Sunglasses Make Facilities Make Other Sunglasses Idle Products Fixed overhead Purchase cost Total cost of obtaining su Profit from other product Net cost of obtaining sun What is the best course Sienna's Shades should make the sunglasses. buy the sunglasses and leave the facilities idle. buy the sunglasses from the outside supplier and use the freed manufacturing facilities to make other products.
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