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Table 5.2 A Company Makes Four Products That Have the Following Characteristics

question 32

Multiple Choice

Table 5.2
A company makes four products that have the following characteristics: Product A sells for $75 but needs $20 of materials and $20 of labor to produce; Product B sells for $90 but needs $45 of materials and $20 of labor to produce; Product C sells for $110 but needs $50 of materials and $30 of labor to produce; Product D sells for $135 but needs $75 of materials and $40 of labor to produce. The processing requirements for each product on each of the four machines are shown in the table.

Work centers W, X, Y, and Z are available for 40 hours per week and have no setup time when switching between products. Market demand is 50 As, 60 Bs, 70 Cs, and 80 Ds per week. In the questions that follow, the traditional method refers to maximizing the contribution margin per unit for each product, and the bottleneck method refers to maximizing the contribution margin per minute at the bottleneck for each product.
-Use the information in Table 5.2. Using the traditional method, what is the profit if the company manufactures the optimal product mix (consider variable costs only-overhead is not included in this profit calculation) ?

Definitions:

Corpus Callosum

The large band of neural fibers connecting the two brain hemispheres and carrying messages between them.

Hippocampus

A major component of the brain involved in learning and memory formation.

Association Areas

Regions of the brain that integrate and process information from the sensory pathways and other parts of the brain for higher functions such as learning, reasoning, and problem-solving.

Cortex

The outermost layer of the brain, responsible for complex functions including thought, memory, and consciousness.