Red Rock Enterprises Is Analyzing Its Sales Mix to Find

question 89

Essay

Red Rock Enterprises is analyzing its sales mix to find out if it is maximizing its profits.The company produces three similar items: Alpha,Beta,and Gamma.All three of these products are made with the same equipment,and maximum productive capacity measured in machine hours is now being used.Product line statistics are as follows:
$$\begin{array} { l r r r } & \text { Alpha } & \text { Beta } & \text { Gamma } \\\text { Current production and sales (units) } & 105,000 & 158,000 & 95,000 \\\text { Machine hours per unit } & 10 & 5 & 13 \\\text { Selling price per unit } & \$ 63.00 & \$ 480 & \$ 84.00 \\\text { Unit variable cost } & \$ 33.00 & \$ 26.00 & \$ 49.00 \\\text { Unit variable selling cost } & \$ 20.00 & \$ 16.00 & \$ 19.00\end{array}$$
Determine whether the existing sales mix is the most profitable one possible.If your answer is no,offer your suggestion to improve the sales mix.Round answers to two decimal places.

---

Definitions:

Atomic Mass

Atomic mass is the mass of an atom, typically expressed in atomic mass units, reflecting the sum of the number of protons and neutrons in the nucleus.

Protons

Positively charged particles within an atom's nucleus.

Neutrons

Neutrons are subatomic particles found in the nucleus of an atom; they are neutral, having no electric charge and a mass slightly greater than that of protons.

Polar Covalent Bonds

A type of chemical bond where a pair of electrons is unequally shared between two atoms, resulting in a molecule with a partially positive end and a partially negative end.