Table 5.1 A Company Makes Four Products That Have the Following Characteristics

question 100

Multiple Choice

Table 5.1
A company makes four products that have the following characteristics: Product A sells for $50 but needs $10 of materials and $15 of labor to produce; Product B sells for $75 but needs $30 of materials and $15 of labor to produce; Product C sells for $100 but needs $50 of materials and $30 of labor to produce; Product D sells for $150 but needs $75 of materials and $40 of labor to produce. The processing requirements for each product on each of the four machines are shown in the table.

Work centers W, X, Y, and Z are available for 40 hours per week and have no setup time when switching between products. Market demand for each product is 80 units per week. In the questions that follow, the traditional method refers to maximizing the contribution margin per unit for each product, and the bottleneck method refers to maximizing the contribution margin per minute at the bottleneck for each product.
-Use the information in Table 5.1. Using the traditional method, what is the optimal product mix (consider variable costs only-overhead is not included in this profit calculation) ?

• A) 71 A, 80B, 80C, 80 D
• B) 80A, 72B, 80C, 80D
• C) 80A, 80B, 60C, 80D
• D) 80A, 80B, 80C, 70D

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Definitions:

Relativist

An individual or doctrine emphasizing the belief that points of ethical and moral significance are relative to individual cultures or personal perspectives.

Ethical Perspective

A viewpoint or angle from which ethical concerns and principles are analyzed and considered.

Company Industry

The specific sector or category of the market in which a company operates, characterized by a particular type of business activity or product/service.

Moral Philosophies

The study of principles and values concerning what is right and wrong, guiding ethical decision-making and moral reasoning.