Glocker Company Makes Three Products in a Single Facility

question 61

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:

Global Warming

The long-term rise in Earth's average temperature, caused mainly by the increase of greenhouse gases in the atmosphere due to human activities.

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Intense cyclonic storm systems that form over the Atlantic Ocean, typically in the warmer months, characterized by strong winds and heavy rain.

Short Duration

A period of time that is brief or lasting only a short while, often used in the context of events or processes.

Ice-Covered Northern Continent

A reference to any continent in the northern hemisphere that is significantly covered by ice, often relating to glacial periods in Earth's history.