Red Rock Enterprises Is Analyzing Its Sales Mix to Find

question 42

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:
$$\begin{array} { l l l l } & \text { Alpha } & \text { Beta } & \text { Gamma } \\\text { Curent production and sales (units) } & 105,000 & 158,000 & 95,000 \\\text { Machine haus per unit } & 10 & 5 & 13 \\\text { Selling price per unit } & \$ 63.00 & \$ 48.00 & \$ 84.00 \\\text { Unit variable cost } & \$ 33.00 & \$ 26.00 & \$ 49.00 \\\text { Unit varaable selling cost } & \$ 20.00 & \$ 16.00 & \$ 19.00\end{array}$$ 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.

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Definitions:

World Trade Networks

A global system of economic and commercial connections facilitated through the exchange of goods, services, and information across different countries and cultures.

Multiculturalism

The presence of, or support for the presence of, several distinct cultural or ethnic groups within a society.

Assimilation

The process by which a person or a group's language and/or culture come to resemble those of another group, often losing their original cultural identity.

Ethnocide

The deliberate and systematic destruction of the culture of an ethnic group, often alongside physical genocide but can occur separately.