In: Accounting
Blossom, Inc., is a small company that manufactures three
versions of patio tables. Unit information for...
Blossom, Inc., is a small company that manufactures three
versions of patio tables. Unit information for its products
follows:
|
Table A |
Table B |
Table C |
Sales price |
$ |
41 |
$ |
45 |
$ |
59 |
Direct materials |
|
7 |
|
8 |
|
9 |
Direct labor |
|
1 |
|
3 |
|
7 |
Variable manufacturing overhead |
|
2 |
|
2 |
|
2 |
Fixed manufacturing overhead |
|
6 |
|
6 |
|
6 |
|
|
|
|
|
|
|
Required number of labor hours |
|
0.50 |
|
0.50 |
|
1.00 |
Required number of machine hours |
|
4.00 |
|
2.50 |
|
2.00 |
|
Blossom has determined that it can sell a limited number of each
table in the upcoming year. Expected demand for each model
follows:
|
|
Table A |
50,000 |
units |
Table B |
20,000 |
units |
Table C |
30,000 |
units |
|
Required:
1. Suppose that direct labor hours has been identified as
the bottleneck resource. Determine how Blossom should prioritize
production by rank ordering the products from 1 to 3.
2. If Blossom has only 40,000 direct labor hours
available, calculate the number of units of each table that Blossom
should produce to maximize its profit.
3. Suppose that the number of machine hours has
been identified as the most constrained resource. Determine how
Blossom should prioritize production by rank ordering the products
from 1 to 3.
4. If Blossom has only 233,000 machine hours
available, calculate the number of units of each table that Blossom
should produce to maximize its profit.
Suppose that direct labor hours has been identified as the
bottleneck resource. Determine how Blossom should prioritize
production by rank ordering the products from 1 to 3.
|
|
Product |
Ranking |
Table A |
|
Table B |
|
Table C |
|
|
If Blossom has only 40,000 direct labor hours available,
calculate the number of units of each table that Blossom should
produce to maximize its profit. (Enter the products in the sequence
of their preferences; the product with first preference should be
entered first.)
|
Suppose that the number of machine hours has been identified as
the most constrained resource. Determine how Blossom should
prioritize production by rank ordering the products from 1 to
3.
|
|
Product |
Ranking |
Table A |
|
Table B |
|
Table C |
|
|
If Blossom has only 233,000 machine hours available, calculate
the number of units of each table that Blossom should produce to
maximize its profit. (Enter the products in the sequence of their
preferences; the product with first preference should be entered
first.)
|