The Constraint at Frayer Inc

question 13

Essay

The constraint at Frayer Inc.is a key raw material.A total of 9,700 ounces of this constrained resource are available.Data concerning the company's two products,Z78 and D87,appear below:
Each unit of product Z78 requires 5 ounces of the constrained raw material;each unit of product D87 requires 2 ounces.
Required:
a.In the present circumstances,which product is most profitable?
b.How much of each product should be produced?
c.The company is considering launching a new product whose variable cost is $157 and that requires 26 ounces of the constrained resource.What is the minimum acceptable selling price for the new product?

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Definitions:

Carrier Delivery

The service of transporting goods to a designated location via a shipping or freight carrier.

Manufacturer Storage

The space or facility designated by manufacturers for storing raw materials, work-in-progress, or finished goods before they are distributed.

Distributor Storage

A logistics strategy where products are stored at distributor-operated warehouses, facilitating faster delivery services to customers.

Package Carrier Delivery

A specialized service provided by companies for shipping parcels and packages directly to recipients or specific destinations.