Billings Company produces two products, Product Reno and Product Tahoe. Each product goes through its own assembly and finishing departments. However, both of them must go through the painting department. The painting department has capacity of 2,028 hours per year. Product Reno has a unit contribution margin of $100 and requires four hours of painting department time. Product Tahoe has a unit contribution margin of $78 and requires three hours of painting department time. There are no other constraints. Required: 1. What is the contribution margin per hour of painting department time for each product? Contribution Margin Reno $ Tahoe $ 2. What is the optimal mix of products? If an amount is zero, enter "0". Optimal Mix Reno units Tahoe units 3. What is the total contribution margin earned for the optimal mix?
8.49
this is a follow up on the same question you just answered - i need to know why the highlighted field in the attached section of your solution was divided by 2 and not by 3 (the hours required for Tahoe painting department).
Please check and confirm the work to answer parts, 1, 2 and 3
Billings Company produces two products, Product Reno and Product Tahoe. Each product goes through its own assembly and finishing departments. However, both of them must go through the painting department. The painting department has capacity of 2,028 hours per year. Product Reno has a unit contribution margin of $100 and requires four hours of painting department time. Product Tahoe has a unit contribution margin of $78 and requires three hours of painting department time. There are no other constraints.
Required:
1. What is the contribution margin per hour of painting department time for each product?
| Contribution Margin | |
| Reno | $ |
| Tahoe | $ |
2. What is the optimal mix of products? If an amount is zero, enter "0".
| Optimal Mix | |
| Reno | units |
| Tahoe | units |
3. What is the total contribution margin earned for the optimal mix?
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