Outdoor Luggage Inc. makes high-end hard-sided luggage for sports equipment. Dat

Question

Outdoor Luggage Inc. makes high-end hard-sided luggage for sports equipment. Data concerning three of the company's most popular models appear below Ski Guard Golf Guard Fishing Guard Selling price per unit Variable cost per unit Plastic injection molding machine processing time required to produce one unit Pounds of plastic pellets per unit $300 $150 $370 $200 $235 $145 10 minutes 11 pounds 11 minutes 6 pounds 10 minutes 13 pounds Required 1a. The total time available on the plastic injection molding machine is the constraint in the production process. What is the contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard? Ski Guard Golf Guard Fishing Guard Selling price per unit Variable cost per unit Contribution margin per unit Plastic injection molding machine processing time required to produce one unit Contribution margin per unit of the constrained resource 0 $ 0 $ 0 minutes minutes minutes 0 per minute 0 per minute 0 per minute 1b. Which product would be the most profitable use of this constraint? Golf Guard Fishing Guard Ski Guard

Explanation / Answer

Particulars Ski Guard Golf Guard Fishing Guard Selling price per unit 300 370 235 Less: Variable cost per unit 150 200 145 Contribution per unit 150 170 90 Plastic Injection molding machine processing time required per unit 10 minutes 11 minutes 10 minutes Contribution per minute 15            15.45 9 Rank In production 2 1 3 Particulars Ski Guard Golf Guard Fishing Guard Selling price per unit 300 370 235 Less: Variable cost per unit 150 200 145 Contribution per unit 150 170 90 Pounds of plastic pellets required to produce one unit 11 pounds 6 pounds 13 pounds Contribution per pound            13.64            28.33                    6.92

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