An Electronics Firm Produces Two Models of Pocket Calculators: the A-100

question 71

Multiple Choice

An electronics firm produces two models of pocket calculators: the A-100 (A) ,which is an inexpensive four-function calculator,and the B-200 (B) ,which also features square root and percent functions.Each model uses one (the same) circuit board,of which there are only 2,500 available for this week's production.Also,the company has allocated a maximum of 800 hours of assembly time this week for producing these calculators,of which the A-100 requires 15 minutes (.25 hours) each,and the B-200 requires 30 minutes (.5 hours) each to produce.The firm forecasts that it could sell a maximum of 4,000 A-100's this week and a maximum of 1,000 B-200's.Profits for the A-100 are $1.00 each,and profits for the B-200 are $4.00 each.For the production combination of 1,400 A-100's and 900 B-200's,which resource is "slack" (not fully used) ?

• A)Circuit boards (only)
• B)Assembly time (only)
• C)Both circuit boards and assembly time
• D)Neither circuit boards nor assembly time
• E)Cannot be determined exactly

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Definitions:

Credit Terms

Conditions under which credit is extended by a lender to a buyer, including repayment time frame and interest rate.

Invoice Date

The date on which an invoice is issued, marking the point in time when the billing process for goods delivered or services rendered begins.

Sales Returns

Transactions where customers return previously purchased merchandise, leading to a reversal of sales revenue.

Allowances Account

An account used to offset the gross accounts receivable balance for the estimated amount of uncollectible accounts.