Product Mix Decision, Single Constraint Sealing Company manufactures three types of DVD storage units. Each of the three types requires the use of a special machine that has a total operating capacity of 15,000 hours per year. Information on the three types of storage units is as follows: Basic Standard Deluxe Selling price $9.00 $30.00 $35.00 Variable cost $6.00 $20.00 $10.00 Machine hours required 0.10 0.50 0.75 Sealing's marketing director has assessed demand for the three types of storage units and believes that the firm can sell as many units as it can produce. Required: 1. How many of each type of unit should be produced and sold to maximize the company's contribution margin? If an amount box does not require an entry, leave it blank or enter "0" required, round your answers to the nearest whole value. Basic 0.1 X units Standard 0.5 x units Deluxe 0.75 X units What is the total contribution margin for vour selection?

Product Mix Decision, Single Constraint Sealing Company manufactures three types of DVD storage units. Each of the three types requires the use of a special machine that has a total operating capacity of 15,000 hours per year. Information on the three types of storage units is as follows: Basic Standard Deluxe Selling price $9.00 $30.00 $35.00 Variable cost $6.00 $20.00 $10.00 Machine hours required 0.10 0.50 0.75 Sealing's marketing director has assessed demand for the three types of storage units and believes that the firm can sell as many units as it can produce. Required: 1. How many of each type of unit should be produced and sold to maximize the company's contribution margin? If an amount box does not require an entry, leave it blank or enter "0" required, round your answers to the nearest whole value. Basic 0.1 X units Standard 0.5 x units Deluxe 0.75 X units What is the total contribution margin for vour selection?

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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

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 62P: Product Mix Decision, Single Constraint Sealing Company manufactures three types of DVD storage...

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Product Mix Decision, Single Constraint Norton Company produces two products (Juno and Hera) that use the same material input. Juno uses two pounds of the material for every unit produced, and Hera uses five pounds. Currently, Norton has 16,000 pounds of the material in inventory. All of the material is imported. For the coming year, Norton plans to import an additional 8,000 pounds to produce 2,000 units of Juno and 4,000 units of Hera. The unit contribution margin is 30 for Juno and 60 for Hera. Also, assume that Nortons marketing department estimates that the company can sell a maximum of 2,000 units of Juno and 4,000 units of Hera. Norton has received word that the source of the material has been shut down by embargo. Consequently, the company will not be able to import the 8,000 pounds it planned to use in the coming years production. There is no other source of the material. Required: 1. Compute the total contribution margin that the company would earn if it could manufacture 2,000 units of Juno and 4,000 units of Hera. 2. Determine the optimal usage of the companys inventory of 16,000 pounds of the material. Compute the total contribution margin for the product mix that you recommend.
Tucariz Company processes Duo into two joint products, Big and Mini. Duo is purchased in 1,000-gallon drums for 2.000. Processing costs are 3,000 to process the 1,000 gallons of Duointo 800 gallons of Big and 200 gallons of Mini. The selling price is 9 per gallon for Big and4 per gallon for Mini. If the physical units method is used to allocate joint costs to the finalproducts, the total cost allocated to produce Mini is: a. 500. b. 4,000. c. 1,000. d. 4,500.
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Sealing Company manufactures three types of DVD storage units. Each of the three types requires the use of a special machine that has a total operating capacity of 15,000 hours per year.Information on the three types of storage units is as follows: Sealing’s marketing director has assessed demand for the three types of storage units andbelieves that the firm can sell as many units as it can produce.Required:1. How many of each type of unit should be produced and sold to maximize the company’scontribution margin? What is the total contribution margin for your selection?2. Now suppose that Sealing Company believes that it can sell no more than 12,000 ofthe deluxe model but up to 50,000 each of the basic and standard models at the sellingprices estimated. What product mix would you recommend, and what would be the totalcontribution margin?
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Vandenberg, Inc., produces and sells two products: a ceiling fan and a table fan. Vandenbergplans to sell 30,000 ceiling fans and 70,000 table fans in the coming year. Product price and costinformation includes: Ceiling Fan Table FanPrice $60 $15Unit variable cost $12 $7Direct fixed cost $23,600 $45,000Common fixed selling and administrative expenses total $85,000.Required:1. What is the sales mix estimated for next year (calculated to the lowest whole number foreach product)?2. Using the sales mix from Requirement 1, form a package of ceiling fans and table fans.How many ceiling fans and table fans are sold at break-even?3. Prepare a contribution-margin-based income statement for Vandenberg, Inc., based on theunit sales calculated in Requirement 2.4. What if Vandenberg, Inc., wanted to earn operating income equal to $14,400? Calculate thenumber of ceiling fans and table…
An organisation manufactures a single product. The following information with    regard to the raw material needed in the production process is supplied to you: Normal delivery time:                                       2.5 weeks Maximum delivery time:                                   3.5 weeks Normal usage:                                                   52 000 units per year Purchase price per unit: R8.50 Cost of placing an order:                                   R18.00 Interest rate:                                                       2% per year Storing cost per unit:                                         R2.50 a). Calculate the safety stock b). Calculate the lead time
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