Question
In: Operations Management
The Hamilton Company manufactures two products: X and Y. Contribution margin per unit is determined as follows:...
The Hamilton Company manufactures two products: X and Y. Contribution margin per unit is determined as follows:
Product X Product Y
Revenue........................................... $130................. $80
Variable Costs................................... .$70................. $38
Contribution margin............................ $60................. $42
Total demand for X is 16,000 units and for Y is 8,000 units. Machine hours are a scarce resource. 42,000 machine hours are available during the year. Product X requires 6 machine hours per unit, while Product Y requires 3 machine hours per unit. How many units of X and Y should Hamilton Company produce?
Solutions
Expert Solution
Hi,
Please find the answer as below.
If you like the answer, please up vote. It will encourage me to contribute more.
I have used excel solver to solve the problem. I have attached the screenshot of input data, formulas and constraints used along with the solution.
Here, objective function is to maximize the contribution margin.
Hence, Hamilton company shoulf produce 3000 Units of Product X and 8000 units of product Y to maximize the contribution margin,
Find the calculation as below.
1. Screenshot of Input Data
2. Screenshot of Formulas used
3. Screenshot of Constraints used
4. Screenshot of Optimum solution
keosha answered 5 months agoRelated Solutions
Calculate the contribution margin per unit and the total contribution margin
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Sage Corporation manufactures two products with the following characteristics. Unit Contribution Margin Machine Hours Required for...
Sage Corporation manufactures two products with the following
characteristics.
Unit Contribution
Margin
Machine Hours
Required for Production
Product 1
$42.00
0.15 hours
Product 2
$32.00
0.10 hours
If Sage’s machine hours are limited to 2,000 per month, determine
which product it should produce.
Product 1
Product 2
Contribution margin per unit of
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$Enter a dollar amount
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LINK TO TEXT
In 250 words explain What is contribution margin per unit? What is contribution margin ratio?
In 250 words explain What is contribution margin per unit? What
is contribution margin ratio?
1. Leeks Company's product has a contribution margin per unit of $12.65 and a contribution margin...
1.
Leeks Company's product has a contribution margin per unit of
$12.65 and a contribution margin ratio of 23.0%. What is the
selling price of the product?
2
Barclay Bikes manufactures and sells three distinct styles of
bicycles: the Youth model sells for $500 and has a unit
contribution margin of $155; the Adult model sells for $950 and has
a unit contribution margin of $500; and the Recreational model
sells for $1,300 and has a unit contribution margin of...
Price, Variable Cost per Unit, Contribution Margin, Contribution Margin Ratio, Fixed Expense For each of the...
Price, Variable Cost
per Unit, Contribution Margin, Contribution Margin Ratio, Fixed
Expense
For each of the
following independent situations, calculate the amount(s)
required.
Required:
1. At
the break-even point, Jefferson Company sells 85,000 units and has
fixed cost of $348,600. The variable cost per unit is $0.35. What
price does Jefferson charge per unit? Note: Round to the
nearest cent.
$
2.
Sooner Industries charges a price of $127 and has fixed cost of
$360,500. Next year, Sooner expects to...
Price, Variable Cost per Unit, Contribution Margin, Contribution Margin Ratio, Fixed Expense For each of the...
Price, Variable Cost per Unit, Contribution Margin, Contribution
Margin Ratio, Fixed Expense
For each of the following independent situations, calculate the
amount(s) required.
Required:
1. At the break-even point, Jefferson Company
sells 95,000 units and has fixed cost of $349,700. The variable
cost per unit is $0.15. What price does Jefferson charge per unit?
Note: Round to the nearest cent.
$
2. Sooner Industries charges a price of $129
and has fixed cost of $421,000. Next year, Sooner expects to...
Price, Variable Cost per Unit, Contribution Margin, Contribution Margin Ratio, Fixed Expense For each of the...
Price, Variable Cost per Unit, Contribution Margin, Contribution
Margin Ratio, Fixed Expense
For each of the following independent situations, calculate the
amount(s) required.
Required:
1. At the break-even point, Jefferson Company
sells 85,000 units and has fixed cost of $351,900. The variable
cost per unit is $0.30. What price does Jefferson charge per unit?
Note: Round to the nearest cent.
$
2. Sooner Industries charges a price of $136
and has fixed cost of $391,500. Next year, Sooner expects to...
Price, Variable Cost per Unit, Contribution Margin, Contribution Margin Ratio, Fixed Expense For each of the...
Price, Variable Cost per Unit, Contribution Margin, Contribution
Margin Ratio, Fixed Expense
For each of the following independent situations, calculate the
amount(s) required.
Required:
1. At the break-even point, Jefferson Company
sells 85,000 units and has fixed cost of $346,500. The variable
cost per unit is $0.10. What price does Jefferson charge per unit?
Note: Round to the nearest cent.
$
2. Sooner Industries charges a price of $98 and
has fixed cost of $476,500. Next year, Sooner expects to...
Price, Variable Cost per Unit, Contribution Margin, Contribution Margin Ratio, Fixed Expense For each of the...
Price, Variable Cost per Unit, Contribution Margin, Contribution
Margin Ratio, Fixed Expense
For each of the following independent situations, calculate the
amount(s) required.
Required:
1. At the break-even point, Jefferson Company
sells 115,000 units and has fixed cost of $346,800. The variable
cost per unit is $0.10. What price does Jefferson charge per unit?
Note: Round to the nearest cent.
$
2. Sooner Industries charges a price of $116
and has fixed cost of $395,500. Next year, Sooner expects to...
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