Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Store - It produces plastic storage bins for household storage needs. (Click the icon to view additional information.) Sales prices and variable costs are
Store - It 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. Requirement 1. Which product should Store - It emphasize? Why? Complete the product mix analysis to determine the contribution margin per machine hour. Store-It Product Mix Analysis Sales price per unit Variable cost per unit Contribution margin per unit. Units per machine hour Contribution margin per machine hour Regular Large The company makes two sizes of bins: large (50 gallon) and regular (35 gallon). Demand for the products is so high that Store - It 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 3,000 hours per period. Store - It can produce 11 large bins every hour, whereas it can produce 16 regular bins in the same amount of time. Fixed costs amount to $100,000 per period. to) Part 1 of 4 - Store It produces plastic storage bins for household storage needs. (Click the icon to view additional information.) Data table > points O Pol Regular Large Sales price per unit $ 8.30 $ 10.90 Variable costs per unit 3.60 4.60 Sale Da Rea - X Requirements 1. Which product should Store - It emphasize? Why? 2. To maximize profits, how many of each size bin should Store - It produce? 3. Given this product mix, what will the company's operating income be?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started