Question

PA7-6 Making Decisions Involving Constrained Resource [LO 7-2,7-7 Blossom, Inc., is a small company that manufactures three versions of patio tables. Unit information for its products follows Table A Table B $ 60 Table C $ 74 14 Sales price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $ 56 12 3 5 13 5 5 5 Required number of labor hours Required number of machine hours 0.5 4.0 0.5 1.0 2.0 2.50 Blossom has determined that it can sell a imited number of each table in the upcoming year. Expected demand for each model follows: Table A Table B Table C 60,000 units 20,000 units 20,000 units Required: 1. Suppose that direct labor hours has been identified as the bottleneck resource. Determine how Blossom should prioritize production by rank ordering the products from 1 to 3 Product Ranking Table A Table B Table C

Answer 1

1. Table A - 2

Table B- 1

Table C- 3

2. Table B - 20000 units

Table A- 60000 units

Table C- 10000 units

3. Table A- 3

Table B- 1

Table C- 2

4. Table B- 20000 Units

Table C- 20000 Units

Table A- 39500 units

protiviti Lalon heury hottle veun the Futre wth Contdenc TAe A Tables Tarlec Lebour hauy A) Marode B demand 201000 t 7 No 0 howy sequired 201000x0.S 100002s Tabe A 2dm and bacoout NO howru nugwhud bo,o00x053 020 hou PARTNERSHIP INTEGRITY INNOVATION HUMILITY

protiviti Tanle e the f o haus equred maune Deman d 2D/000 x2 5 S000o oru 2 0010Z TABLE C S eg ured mauhme demad e) Balane hou oत ह feg uud 4 macine houy uhourns 15P000 e pradued PARTNERSHIP INTEGRITY

Talde TaLd B Tatl A 1 3 D.Mae 1 2 3 DLab Vamas Total L46 37 36 Conbutulitn tabour 7 hows niribulr 7 Yen Labun 4 46 houn Maurne 2 5 2 Condnble marhine 2.6 23

Balene hem aina 9001 Table c eqired houy 1 1 No 0 Mauhe hours Constvawts TARLE A 227 4 No Man hours avai labe 24g000 coLLABORATION