Glocker Company Makes Three Products in a Single Facility

question 106

Essay

Glocker Company makes three products in a single facility.These products have the following unit product costs: Additional data concerning these products are listed below. The mixing machines are potentially the constraint in the production facility.A total of 5, 900 minutes are available per month on these machines.
Direct labor is a variable cost in this company.
Required:
a.How many minutes of mixing machine time would be required to satisfy demand for all three products?
b.How much of each product should be produced to maximize net operating income? (Round off to the nearest whole unit. )
c.Up to how much should the company be willing to pay for one additional hour of mixing machine time if the company has made the best use of the existing mixing machine capacity? (Round off to the nearest whole cent. )

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Definitions:

Genus

In the system of plant and animal classification, a group of like species.

Mousterian Tools

Stone tools associated with Neanderthal cultures, known for their specific flaking technique.

Neandertal

An extinct species of human characterized by robust physical features, known to have lived in Europe and parts of Asia until about 40,000 years ago.

Homo Erectus

An extinct species of early human that lived from approximately 2 million to roughly 100,000 years ago, known for being one of the first hominins to use fire and sophisticated tools.