Fontana Corporation's Two Products Have the Following Characteristics: the Constrained

question 69

Multiple Choice

Fontana Corporation's two products have the following characteristics: The constrained resource is a particular machine that is available for 9,800 minutes each month. Each unit of product S83E requires 16 minutes on this machine and each unit of product G29P requires 5 minutes on this machine.
-How many units of product S83E should be produced each month?

• A) 923
• B) 0
• C) 460
• D) 150

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Definitions:

Intra-Entity Asset Transfers

Movements of assets from one part of a business to another within the same corporation, often for accounting or strategic purposes.

Useful Life

The estimated period over which an asset is expected to be usable for its intended purpose, with normal maintenance.

Intra-Entity Transactions

Transactions that occur between entities within the same parent company, which may need to be eliminated in consolidated financial statements.

Straight-Line Deprecation

A method of calculating the depreciation of an asset, where the cost is evenly spread over its useful life.