Business, 12.08.2020 07:01 apowers1760
Outdoor Luggage, Inc., makes high-end hard-sided luggage for sports equipment. Data concerning three of the company’s most popular models appear below.
Ski Golf Fishing
Guard Guard Guard
Selling price per unit $200 $300 $255
Variable cost per unit $60 $140 $55
Plastic injection molding
machine processing time
required to produce one unit 2 minutes 5 minutes 4 minutes
Pounds of plastic pellets
per unit 7 pounds 4 pounds 8 pounds
Required:
1A. The total time available on the plastic injection molding machine is the constraint in the production process. What is the contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?
1B. Which product would be the most profitable use of this constraint?
A. Ski Guard
B. Golf Guard
C. Fishing Guard
1C. Which product would be the least profitable use of this constraint?
A. Ski Guard
B. Golf Guard
C. Fishing Guard
2A. A severe shortage of plastic pellets has required the company to cut back its production so much that the plastic injection molding machine is no longer the bottleneck. Instead, the constraint is the total available pounds of plastic pellets. What is contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?
2B. Which product would be the most profitable use of this constraint?
A. Ski Guard
B. Golf Guard
C. Fishing Guard
2C. Which product would be the least profitable use of this constraint?
A. Ski Guard
B. Golf Guard
C. Fishing Guard
3. Which product has the largest unit contribution margin?
A. Ski Guard
B. Golf Guard
C. Fishing Guard
Answers: 3
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Outdoor Luggage, Inc., makes high-end hard-sided luggage for sports equipment. Data concerning three...
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