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Reference: 09-13
Brown Company Makes Four Products in a Single

question 6

Multiple Choice

Reference: 09-13
Brown Company makes four products in a single facility. These products have the following unit product costs:  Product ABCD Direct materials $15.60$19.50$12.50$15.20 Direct labour 17.6021.0015.409.40 Variable manufacturing  overhead 4.405.608.105.10 Fixed manufacturing  overhead 27.5014.4014.5016.50 Unit product cost $65.10$60.50$50.50$46.20\begin{array}{|l|c|c|c|c|}\hline&\text { Product }\\\hline &A&B&C&D\\\hline \text { Direct materials } & \$ 15.60 & \$ 19.50 & \$ 12.50 & \$ 15.20 \\\hline \text { Direct labour } & 17.60 & 21.00 & 15.40 & 9.40 \\\hline \begin{array}{l}\text { Variable manufacturing } \\\text { overhead }\end{array} & 4.40 & 5.60 & 8.10 & 5.10 \\\hline \begin{array}{l}\text { Fixed manufacturing } \\\text { overhead }\end{array} & 27.50 & 14.40 & 14.50 & 16.50 \\\hline \text { Unit product cost } & \underline{\underline{\$ 65.10}} & \$ 60.50 & \$ 50.50 & \$ 46.20 \\\hline\end{array}
 Additional data concerning these products are listed below. \text { Additional data concerning these products are listed below. }
 Product ABCD Grinding minutes per unit 2.001.100.700.30 Selling price per unit $78.70$71.10$67.90$62.60 Variable selling cost per  unit $2.60$3.10$2.80$3.50 Monthly demand in units 3,0002,0002,0004,000\begin{array}{|l|l|l|l|l|}\hline&\text { Product }\\\hline &A&B&C&D\\\hline \text { Grinding minutes per unit } & 2.00 & 1.10 & 0.70 & 0.30 \\\hline \text { Selling price per unit } & \$ 78.70 & \$ 71.10 & \$ 67.90 & \$ 62.60 \\\hline \begin{array}{l}\text { Variable selling cost per } \\\text { unit }\end{array} & \$ 2.60 & \$ 3.10 & \$ 2.80 & \$ 3.50 \\\hline \text { Monthly demand in units } & 3,000 & 2,000 & 2,000 & 4,000 \\\hline\end{array} The grinding machines are potentially the constraint in the production facility. A total of 10,500 minutes are available per month on these machines. Direct labour is a variable cost in this company.
-Which product makes the MOST profitable use of the grinding machines


Definitions:

Prejudice

Preconceived opinion not based on reason or actual experience, often leading to biased treatment of individuals or groups.

Diverse Populations

Groups of people from varying backgrounds, cultures, races, ethnicities, genders, and other characteristics within a given population.

Negative Attitudes

A general disposition of disapproval, dislike, or pessimism towards people, objects, or situations.

Discrimination

Unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, or gender.

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