QUESTION 3 The constraint at Mcglathery Corporation is time on a particular mach
ID: 2494931 • Letter: Q
Question
QUESTION 3
The constraint at Mcglathery Corporation is time on a particular machine. The company makes three products that use this machine. Data concerning those products appear below:
UE
BI
CR
Selling price per unit
$335.11
$228.39
$199.14
Variable cost per unit
$259.40
$173.22
$159.75
Minutes on the constraint
6.80
3.60
4.80
Assume that sufficient time is available on the constrained machine to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource? (Round your intermediate calculations and final answer to 2 decimal places.)
$39.39 per unit
$8.21 per minute
$75.71 per unit
$15.33 per minute
7 points
QUESTION 4
The Tingey Company has 400 obsolete microcomputers that are carried in inventory at a total cost of $576,000. If these microcomputers are upgraded at a total cost of $180,000, they can be sold for a total of $240,000. As an alternative, the microcomputers can be sold in their present condition for $40,000.
What is the net advantage or disadvantage to the company from upgrading the computers rather than selling them in their present condition?
$20,000 advantage
$60,000 advantage
$640,000 disadvantage
$200,000 advantage
The constraint at Mcglathery Corporation is time on a particular machine. The company makes three products that use this machine. Data concerning those products appear below:
Explanation / Answer
Solution:
(A). Sufficient Time Calucuclation:
Least Profitable Product is "CR"
= $ 199.14 - $ 159.75
= $ 39.39 Per Unit
(B).
Tingey Company 400 microcomputers Produced
Carried in inventory at a total cost of $576,000
The Total Cost Upgraded to $ 1,80,000
Now Total Cost is $ 1,80,000
Sold for Comoputers $ 2,40,000
Avantage is = $ 60,000
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