Mobley Company Makes Three Products in a Single Facility

question 82

Essay

Mobley Company makes three products in a single facility. Data concerning these products follow:

The mixing machines are potentially the constraint in the production facility. A total of 6,300 minutes is available per month on these machines. Direct labor is a variable cost in this company.
Required:
a. How many minutes of mixing machine time would be required to satisfy demand for all three products?
b. How much of each product should be produced to maximize net operating income? (Round off to the nearest whole unit.)
c. Up to how much should the company be willing to pay for one additional hour of mixing machine time if the company has made the best use of the existing mixing machine capacity? (Round off to the nearest whole cent.)

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Definitions:

Organizational Culture

The collection of values, expectations, and practices that guide and inform the actions of all team members of an organization.

Open Communication

A form of communication where all parties freely express their thoughts and feelings honestly and clearly.

Self-disclosure

The act of revealing personal information about oneself to others, which can help in building trust and relationships.

Trust

A firm belief in the reliability, truth, ability, or strength of someone or something.