Question 1 Zoom Corporation manufactures and sells three different types of bino

Question

Question 1 Zoom Corporation manufactures and sells three different types of binoculars. They are referred to as Good, Better, and Best binoculars. Grinding and polishing time is limited. More time is required to grind and polish the lenses used in the Better and Best binoculars. Additional information is provided below. Product Good Better Best Selling price $100.00 $304.20 $870.00 Variable costs and expenses 52.00 182.00 485.00 Contribution margin $48.00 $122.20 $385.00 Grinding and polishing time required 0.6 hrs 1.3 hrs 5 hrs Ignoring the time constraint, what strategy would appear to be optimal? The company should shift toward production of more units. LINK TO TEXT What is the contribution margin per unit of limited resource for each type of binocular? (Round answer to 0 decimal places, e.g. 5,275.) Good Better Best Contribution margin per unit of limited resource $ $ $ LINK TO TEXT If additional grinding and polishing time could be obtained, how should the additional capacity be used? Additional capacity should be used to make binoculars.

Explanation / Answer

Zoom Corporation Optimal Production Strategy Products binoculars Perticulars Good Better Best Selling Price $100.00 $304.20 $870.00 Variable Cost $52.00 $182.00 $485.00 Contribution Margin $48.00 $122.20 $385.00 ( Selling price - Variable Cost) Grinding & Polishing Time 0.6 Hrs 1.3 hrs 5 Hrs Contribution Per Hrs $80.00 $94.00 $77.00 Contribution/per hrs required Ranking on the basis of contribution per hours II I III Conclusion Optimal strategy of Zoom Corporation is that made more production of Better binoculers as compare to good and best because better has more contributuin margin i.e. $94 per hrs as compare to good & best ( 80 & 77 ) If Additional grinding & polishing time obtain that’s shuold be first use to produced the better binoculars has highest contribution margin 94 per hrs if sapre time is avialable than 2nd use for good binoculars has contribution margin 80 and lastly used for best binoculares

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