Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Witchs brew company manufactures and sells three potions that all use gargoyle eyelashes as an Witch As an ingredient. The high demand for all three

Witchs brew company manufactures and sells three potions that all use gargoyle eyelashes as an Witch As an ingredient. The high demand for all three of these potions exceeds the supply of gargoyle eyelashes that witches brew is able to buy from its supplier. Information is as follows:

Beauty potion,: selling price $100, variable cost per bottle 70, Eyelashes required Per bottle 2, sales demand in units 1, 000.

Luck potion: selling price 120, vc per bottle 84, eyelashes required 3, sales demand in units 1, 500

Smart potion: selling price 200, vc per bottle 130, eyelashes 5, Sales demand 1800

A) how many eyelashes would be required to satisfy demand for all 3 products?

B) each year witches brew is only able to buy 14,000 gargoyle eyelashes. Using only the information above, basing the decision solely on maximizing net operating income, how many bottles, if any, of each potion should witches bre make?

C) a new supplier is found that has eyelashes available to sell. How many eyelashes would witches brew need to purchase? What is the maximum amount witches brew would be willing to pay per eyelash? Assume the normal cost of an eyelash is $10

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Using Financial Accounting Information The Alternative to Debits and Credits

Authors: Gary A. Porter, Curtis L. Norton

7th Edition

978-0-538-4527, 0-538-45274-9, 978-1133161646

More Books

Students also viewed these Accounting questions