Falsetta Corporation makes three products that use the current constraint, which is a particular type of machine. Data concerning those products appear below: ZA JK DH Selling price per unit........................ $402.67 $462.82 $374.06 Variable cost per unit....................... $307.53 $344.56 $285.56 Time on the constraint (minutes) ...... 6.70 7.30 5.90 Required: a. Rank the products in order of their current profitability from the most profitable to the least profitable. In other words, rank the products in the order in which they should be emphasized. Show your work! b. Assume that sufficient constraint time is available to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource?

Falsetta Corporation makes three products that use the current constraint, which is a particular type of machine. Data concerning those products appear below: ZA JK DH Selling price per unit........................ $402.67 $462.82 $374.06 Variable cost per unit....................... $307.53 $344.56 $285.56 Time on the constraint (minutes) ...... 6.70 7.30 5.90 Required: a. Rank the products in order of their current profitability from the most profitable to the least profitable. In other words, rank the products in the order in which they should be emphasized. Show your work! b. Assume that sufficient constraint time is available to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter7: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 46E: Lotts Company produces and sells one product. The selling price is 10, and the unit variable cost is...

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