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Options are Highest or lowest

two or four or five

only one deluxe or only the deluxe model or two times as many deluxe model as regular models or two times as many regular models as deluxe models

ExerLight produces two types of exercise treadmills: Regular and Deluxe. The exercise craze is such that ExerLight could use all of its available machine hours producing either model. The two models are processed through the same Production Department (Click the icon to view the data.) What product mix will maximize operating income? (Hint. Use the allocation of fixed manufacturing overhead to determine the proportion of machine hours used by each product.) Prepare the product mix analysis. ExerLight Product Mix Analysis Sale price per unit Deluxe $1,030 737 Regular 580 469 Variable costs per unit Contribution margin per unit Units produced with equivalent number of machine hours Contribution margin for equivalent number of machine hours ExerLight should produce the product with the contribution margin per unit of the constraint. v times as much overhead cost is allocated to each Deluxe model as to each Regular model. In other words, it takes times as many machine hours to produce a Deluxe model. Data Table u ed throu Per Unit Deluxe 1,030 $ Regular 580 $ $ 100 350 $ 88 198 184 92 Sales price Costs: Direct materials Direct labour Variable manufacturing overhead Fixed manufacturing overhead* Variable operating expenses Total cost Operating income * Allocated on the basis of machine hours. 100 115 50 79 837 519 $ 193 $ 61 ExerLight should produce the product with the contribution margin per unit of the constraint. times as much overhead cost is allocated to each Deluxe model as to each Regular model. In other words, it takes times as many machine hours to produce a Deluxe model. For each unit of the Deluxe model produced (contributing $to operating income), ExerLight can produce V units of the Regular model contributing $ each to operating income). Therefore, ExerLight should produce