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StoreAll produces plastic storage bins for household storage needs. Sales prices and variable costs are as follows: EEB (Click the icon to view the costs.)
StoreAll produces plastic storage bins for household storage needs. Sales prices and variable costs are as follows: EEB (Click the icon to view the costs.) Read the requirements (Click the icon to view additional information.) Requirement 1. Which product should StoreAll emphasize? Why? More Info Complete the product mix analysis to determine the contribution margin per machine hour StoreAll Product Mix Analysis The company makes two sizes of bins: large (50 gallon) and regular (35 gallon). Demand for the products is so high that StoreAll 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. StoreAll can produce 12 large bins every hour, whereas it can produce 15 regular bins in the same amount of time. Fixed costs amount to $100,000 per period Regular Large Sales price per unit Variable cost per unit Contribution margin per unit Units per machine hour Contribution margin per machine hour Which product should StoreAll emphasize? Why? StoreAll should emphasize the production of Requirement 2. To maximize profits, how many of each size bin should StoreAll produce? (Enter a "0" for any zero amounts.) StoreAll should spend machine hours making Requirement 3. Given this product mix, what will the company's operating income be? Number of regular size bins per perio Print Done Vbecause this product has the higher Data Table machine hours making regular size bins, and large size bins. Regular Large S 8.30 S 10.10 Sales price per unit margin per regular size bin 4.40 Variable costs per unit 3.00 Total contribution margin Fixed costs Operating income Print Done
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