PROBLEM 7-6. Additional Processing Decision with a Production Constraint Mega Chemical Company produces ZylexA and a related product called ZylexB, along with other products. ZylexB, which sells for $13.50 per gallon, is made from a base of ZylexA plus additional ingredients. It takes 20 minutes to manufacture a gallon of ZylexA and an additional 10 minutes to manufacture a gallon of ZylexB. ZylexA sells for $9.75 per gallon. The cost per gallon of manufacturing ZylexA and the additional costs to convert it into ZylexB are:

Additional Cost ZylexA of ZylexB Material $2.25 $1.90 Labor 1.80 .70 Variable overhead 2.60 1.20 Both products have been successful and demand for both products is strong. However, Mega's other products are also in demand and the company is operating at capacity.

Since it takes longer to manufacture ZylexB, the vice president of production is trying to determine whether ZylexB should be produced.

Required Which product makes the largest contribution to company profit given a capacity constraint measured in terms of production time?