The Management of Cerruto Corporation Has Provided the Following Data

question 22

Multiple Choice

The management of Cerruto Corporation has provided the following data concerning its two products: The constrained resource is a particular machine that is available for 9,600 minutes each month.
-Up to how much should the company be willing to pay to obtain enough of the constrained resource to satisfy demand for the two existing products?

• A) $120.90 per minute
• B) $9.30 per minute
• C) $13.20 per minute
• D) $66.00 per minute

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Definitions:

Weighted-average

A calculation that takes into account the varying degrees of importance of the numbers in a data set.

Work in Process

Inventory that includes goods partially completed but not yet ready for sale, representing costs of direct labor, materials, and overhead.

Equivalent Units

A term used in cost accounting to express the amount of work done during a period in terms of complete units of output.

First-in

A method used in inventory valuation where the first goods purchased are the first ones to be used or sold.