Outdoor Luggage, Inc., makes high-end hard-sided luggage for sports equipment. D
ID: 2525545 • Letter: O
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.
1.If we assume that the total time available on the plastic injection molding machine is the constraint in the production process, how much contribution margin per minute of the constrained resource is earned by each product? (Round your final answers to 2 decimal places.)
Which product offers the most profitable use of the plastic injection molding machine?
Ski Gaurd - Golf gaurd - fishing gaurd
If we assume that a severe shortage of plastic pellets has required the company to cut back its production so much that its new constraint has become the total available pounds of plastic pellets, how much contribution margin per pound of the constrained resource is earned by each product? (Round your final answers to 2 decimal places.)
Which product offers the most profitable use of the plastic pellets?
Golf Gaurd - ski gaurd - fish gaurd
Which product has the largest contribution margin per unit?
Golf Gaurd - ski gaurd - fish gaurd
SkiGuard Golf
Guard Fishing
Guard Selling price per unit $ 260 $ 330 $ 205 Variable cost per unit $ 120 $ 180 $ 135 Plastic injection molding machine processing
time required to produce one unit 9 minutes 12 minutes 11 minutes Pounds of plastic pellets per unit 12 pounds 15 pounds 11 pounds
Explanation / Answer
1 Ski Guard Golf Guard Fishing Guard Selling price per unit 260 330 205 Less: Variable cost per unit 120 180 135 Contribution margin per unit 140 150 70 Plastic injection molding machine processing time per unit 9 12 11 Contribution margin per minute of the constrained resource 15.56 12.50 6.36 2 Ski Guard 3 Ski Guard Golf Guard Fishing Guard Selling price per unit 260 330 205 Less: Variable cost per unit 120 180 135 Contribution margin per unit 140 150 70 Pounds of plastic pellets per unit 12 15 11 Contribution margin per minute of the constrained resource 11.67 10.00 6.36 4 Ski Guard 5 Golf Guard
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