Question

Blanks ​Products, located in Atlanta comma Georgia​, produces two lines of electric​ toothbrushes: Deluxe and Standard. Because Blank can sell all the toothbrushes it​ produces, the owners are expanding the plant. They are deciding which product line to emphasize. To make this​ decision, they assemble the following​ data:

Per Unit

Deluxe

Standard

Toothbrush

Toothbrush

Sales price. . . . . . . . . . . . . . . . . . . .

$84

$45

Variable expenses. . . . . . . . . . . . . . . . .

22

16

Contribution margin. . . . . . . . . . . . . .

$62

$29

Contribution margin ratio. . . . . . . . . .

73.8%

64.4%

After​ expansion, the factory will have a production capacity of 4 comma 200 machine hours per month. The plant can manufacture either 68 Standard electric toothbrushes or 26 Deluxe electric toothbrushes per machine hour. Requirements 1. Identify the constraining factor for Blank Products. 2. Prepare an analysis to show which product line to emphasize.

Requirement 1. Identify the constraining factor for Blanks constraint is ▼ direct materials labor hours machine hours .

Requirement 2. Prepare an analysis to show which product line to emphasize.    Blanks Products Product Mix Analysis Deluxe Standard



Brett Products, located in Atlanta, Georgia, produces two lines of electric toothbrushes: Deluxe and Standard. Because Brett
Requirement 2. Prepare an analysis to show which product line to emphasize. Brett Products Product Mix Analysis Deluxe Standa
Decision: Choose fro Emphasize the Brett Standard electric toohbrushes. Emphasize the Brett Deluxe electric toohbrushes. en c
A Data Table Per Unit Deluxe Toothbrush Sales price 84 Variable expenses....... 22 Contribution margin .... ............$ 62
0 0
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Answer #1
Contrainst is limited resource i.e. machine hours
Product Mix Analysis
Deluxe Standard
Sale price 84 45
Variable expense 22 16
Contribution margin per unit 62 29
Number of toothbrushes per hour 26 68
Total contribution margin per hour        1,612        1,972
Decision: Standard since CM per hour is more
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