Brann, located in San Antonio, Texas, produces two lines of electric toothbrushes: deluxe and standard. Because Brann can sell all the toothbrushes it can produce, the owners are expanding the plant. They are deciding which product line to emphasize. To make this decision, they assemble the following data:

After expansion, the factory will have a production capacity of 4,800 machine hours per month. The plant can manufacture either 50 standard electric toothbrushes or 40 deluxe electric toothbrushes per machine hour.
Requirements
1. Identify the constraining factor for Brann.
2. Prepare an analysis to show which product line the company should emphasize.

Transcribed Image Text:

Per Unit Deluxe Toothbrush Toothbrush Standard Sales price Variable expense Contribution margin Contribution margin ratio $ 54 17 $37 68.5% S 80 58 725%