Question: Requirement 1 . Which product should StoreAll emphasize ? Why? Complete the product mix analysis to determine the contribution margin per machine hour. StoreAll Product
Requirement Which product should StoreAll emphasize Why?
Complete the product mix analysis to determine the contribution margin per machine hour.
StoreAll
Product Mix Analysis
Regular
Large
Sales price per unit
Variable cost per unit
Contribution margin per unit
Units per machine hour
times
times
Contribution margin per machine hour
Part
Which product should StoreAll emphasize Why?
StoreAll should emphasize the production of
large bins
regular bins
because this product has the higher
contribution margin per machine hour.
contribution margin per unit.
sales price per unit.
variable cost per unit.
Part
Requirement To maximize profits, how many of each size bin should StoreAll produceEnter a for any zero amounts.
StoreAll should spend
machine hours making
regular size bins, and
machine hours making
large size bins.
Part
Requirement 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
times
Total contribution margin
Fixed costs
Operating income
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