Question

Snow, Inc., makes three kinds of snowboards, but it has a limited number of machine hours available to make them.  Product line data are as follows:

                                                                                                  Wood          Plastic         Graphite

            Machine hours per unit                                                1.25            1.0               1.5

            Selling price per unit                                                    $100           $120            $200

            Variable manufacturing cost per unit                               45                50              100

            Variable selling cost per unit                                           15                26                36

In what order should the snowboard product lines be produced?

Answer 1

Graphite 200 100 26 36 Particulars Wood Plastic Selling price per unit 100 120 Variable manuf cost p.u 45 50 Variable selling cost p.u 15 Contribution margin p.u Machine hours per unit 1.25 11 CM per mahine hours 32 44 Rank base on CM per hour 40 64 1.5 42.7