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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. Sales price per pair Less: Variable expenses per pair Contribution margin per pair Units produced each machine hour Contribution margin per machine hour Standard Deluxe 18 28 Data table Sales price per pair Variable expenses per pair X Standard Deluxe $ 18 $ 28 12 22 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. Sales price per pair Standard Deluxe 18 28 Less: Variable expenses per pair Contribution margin per pair Units produced each machine hour Contribution margin per machine hour Capacity number of machine hours Total contribution margin at full capacity Which model should Sienna's emphasize? Sienna's should amohacize the model Which model should Sienna's emphasize? Sienna's should emphasize the model. Requirement 2. Sienna's also p analyze the alternatives. What is uct cti First, complete the following tabl standard deluxe 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 Buy Sunglasses Make Sunglasses Facilities Make Other Idle Products 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 What is the best course of action? Buy Sunglasses Make Other Products Make Facilities Sunglasses Idle Fixed overhead Purchase cost Total cost of obtaining su Profit from other producti Net cost of obtaining sun What is the best course c 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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