Rebus company makes three products in a single facility. Data concerning these p
ID: 2481618 • Letter: R
Question
Rebus company makes three products in a single facility. Data concerning these products follow: The mixing machines are potentially the constraint in the production facility. A total of 6,300 minutes are available per month on these machines. Direct labor is a variable cost in this company. Compute how many minutes of mixing machine time would be required to satisfy. demand for each of the three product. Compute how many units of each product should be produced to maximize net operating income (Round off to the nearest whole unit)Explanation / Answer
a A B C mixing minutes per unit 1.2 0.8 0.4 monthly demand 2000 4000 2000 total minutes required 2400 3200 800 b A B C SP 70 92.4 85.9 Less:direct material 34 50.5 56.9 Less:direct labor 21.4 24 14.8 Less:variable manf oh 1.2 0.6 0.5 Less:variable selling cost 1.8 2.3 2.1 Contribution 11.6 15 11.6 contribution per mixing minute 9.67 18.75 29 rank 3 2 1 monthly demand 2000 4000 2000 minutes allocated 2300 3200 800 units produced 1916 4000 2000
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