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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 follows: (Click
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. Sales price per unit Variable cost per unit Contribution margin per unit Units per machine hour Store-It Product Mix Analysis Contribution margin per machine hour Regular Large More info 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 a it can produce. The company uses the same machinery to produce both sizes. The machinery can only be run for 3,600 hours per period. Store - can produce 11 large bins every hour, whereas it can produce 17 regular bins in the same amount of time. Fixed costs amount to $130,000 per period. Print Done Data table Regular Large Sales price per unit Variable costs per unit $ 9.00 5 10.30 3.60 4:30 Print Done 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? Print Done
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