Containers Plus produces plastic storage bins for household storage needs. (Click the icon to view additional...
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Containers Plus produces plastic storage bins for household storage needs. (Click the icon to view additional information.) Sales prices and variable costs are as follows: (Click the icon to view the costs.) Read the requirements. Requirement 1. Which product should Containers Plus emphasize? Why? Complete the product mix analysis to determine the contribution margin per machine hour. Containers Plus Product Mix Analysis Sales price per unit Variable cost per unit Contribution margin per unit Units per machine hour Contribution margin per machine hour Regular Large 8.60 10.00 3.30 4.00 5.30 6.00 15 79.50 60.00 Which product should Containers Plus emphasize? Why? Containers Plus should emphasize the production of regular bins because this product has the higher contribution margin per machine hour. Requirement 2. To maximize profits, how many of each size bin should Containers Plus produce? (Enter a "0" for any zero amounts.) Containers Plus should spend 2,900 machine hours making 43,500 regular size bins, and 0 machine hours making O large size bins. Requirement 3. Given this product mix, what will the company's operating income be? Number of regular size bins per period Contribution margin per regular size bin Total contribution margin Fixed costs Operating income More info The company makes two sizes of bins: large (50 gallon) and regular (35 gallon). Demand for the products is so high that Containers Plus can sell as many of each size as it can produce. The company uses the same machinery to produce both sizes. The machinery can only be run for 2,900 hours per period. Containers Plus can produce 10 large bins every hour, whereas it can produce 15 regular bins in the same amount of time. Fixed costs amount to $120,000 per period. Print Done - X Requirements 1. Which product should Containers Plus emphasize? Why? 2. To maximize profits, how many of each size bin should Containers Plus produce? 3. Given this product mix, what will the company's operating income be? Print Done - Data table Regular Large Sales price per unit $ 8.60 $ 10.00 Variable costs per unit 3.30 4.00 Print Done Containers Plus produces plastic storage bins for household storage needs. (Click the icon to view additional information.) Sales prices and variable costs are as follows: (Click the icon to view the costs.) Read the requirements. Requirement 1. Which product should Containers Plus emphasize? Why? Complete the product mix analysis to determine the contribution margin per machine hour. Containers Plus Product Mix Analysis Sales price per unit Variable cost per unit Contribution margin per unit Units per machine hour Contribution margin per machine hour Regular Large 8.60 10.00 3.30 4.00 5.30 6.00 15 79.50 60.00 Which product should Containers Plus emphasize? Why? Containers Plus should emphasize the production of regular bins because this product has the higher contribution margin per machine hour. Requirement 2. To maximize profits, how many of each size bin should Containers Plus produce? (Enter a "0" for any zero amounts.) Containers Plus should spend 2,900 machine hours making 43,500 regular size bins, and 0 machine hours making O large size bins. Requirement 3. Given this product mix, what will the company's operating income be? Number of regular size bins per period Contribution margin per regular size bin Total contribution margin Fixed costs Operating income More info The company makes two sizes of bins: large (50 gallon) and regular (35 gallon). Demand for the products is so high that Containers Plus can sell as many of each size as it can produce. The company uses the same machinery to produce both sizes. The machinery can only be run for 2,900 hours per period. Containers Plus can produce 10 large bins every hour, whereas it can produce 15 regular bins in the same amount of time. Fixed costs amount to $120,000 per period. Print Done - X Requirements 1. Which product should Containers Plus emphasize? Why? 2. To maximize profits, how many of each size bin should Containers Plus produce? 3. Given this product mix, what will the company's operating income be? Print Done - Data table Regular Large Sales price per unit $ 8.60 $ 10.00 Variable costs per unit 3.30 4.00 Print Done
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