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Store - It produces plastic storage bins for household storage needs. (Click the icon to view additional information.) Sales prices and variable costs are as
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. Requirements Store-It Product Mix Analysis 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? Regular Large Sales price per unit Variable cost per unit Contribution margin per unit Units per machine hour Print Done Contribution margin per machine hour X More info Data table 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 3,100 hours per period. Store - It can produce 10 large bins every hour, whereas it can produce 17 regular bins in the same amount of time. Fixed costs amount to $120,000 per period. Sales price per unit Variable costs per unit Regular Large $ 8.60 $ 11.00 3.40 4.00
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