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28. Up to how much should the company be willing to pay to obtain enough of the
constrained resource to satisfy demand for the two existing products?
The management of Mccreadie Corporation has provided the following data concerning its
two products:
The constrained resource is a particular machine that is available for 10,400 minutes each month.
29. How many units of product L33Y should be produced each month?
30. Up to how much should the company be willing to pay to obtain enough of the
constrained resource to satisfy demand for the two existing products?
Garwood Corporation's two products have the following characteristics:
The constrained resource is a particular machine that is available for 10,100 minutes each month.
Each unit of product K56J requires 10 minutes on this machine and each unit of product L72D
requires 6 minutes on this machine.
31. What is the maximum contribution margin the company can earn per month?
32. The company is considering launching a new product that would have a variable cost of
$51.00 per unit. It would require 14 minutes of the constrained resource. The absolute minimum
acceptable selling price for the new product should be:
Burrington Products Inc. makes two products—Z74I and R53Y. Product Z74I's selling price
is $102.00 and its unit variable cost is $71.40. Product R53Y's selling price is $432.00 and its unit
variable cost is $302.40. The monthly demand is 2,500 units for product Z74I and 470 units for
R53Y. The constrained resource is a particular machine that is available for 9,900 minutes each
month. Each unit of product Z74I requires 3 minutes on this machine and each unit of product
R53Y requires 16 minutes on this machine.
33. What is the maximum contribution margin the company can earn per month?
34. The company is considering launching a new product that would have a variable cost of
$160.00 per unit and no avoidable fixed costs. It would require 18 minutes of the constrained
resource. The absolute minimum acceptable selling price for the new product should be:
The management of Rodwell Corporation has provided the following data concerning its two
products—E99 and V09:
The constrained resource is a particular machine that is available for 10,400 minutes each month.
Each unit of product E99 requires 8 minutes on this machine. Each unit of product V09 requires
10 minutes on this machine.
35. What is the maximum contribution margin the company can earn per month?
36. The company is considering launching a new product that would have a variable cost of
$181.00 per unit. It would require 14 minutes of the constrained resource. The absolute minimum
acceptable selling price for the new product should be:
The management of Bachor Corporation has provided the following data concerning its
two products:
The constrained resource is a particular machine that is available for 9,800 minutes each month.
37. How many units of product A19D should be produced each month?
App B-31
38. What is the maximum contribution margin the company can earn per month?
39. Up to how much should the company be willing to pay to obtain enough of the
constrained resource to satisfy demand for the two existing products?
40. The company is considering launching a new product that would have a variable cost of
$53.00 per unit. It would require 4 minutes of the constrained resource. The absolute minimum
acceptable selling price for the new product should be:
Shorr Corporation's two products have the following characteristics:
The constrained resource is a particular machine that is available for 9,900 minutes each month.
Each unit of product U29D requires 16 minutes on this machine and each unit of product X43P
requires 2 minutes on this machine.
41. How many units of product U29D should be produced each month?
42. What is the maximum contribution margin the company can earn per month?
43. Up to how much should the company be willing to pay to obtain enough of the
constrained resource to satisfy demand for the two existing products?
44. The company is considering launching a new product that would have a variable cost of
$169.00 per unit and no avoidable fixed costs. It would require 15 minutes of the constrained
resource. The absolute minimum acceptable selling price for the new product should be:
Gorey Products Inc. makes two products—K36L and W81H. Product K36L's selling price is
$345.00 and its unit variable cost is $310.50. Product W81H's selling price is $256.00 and its unit
variable cost is $230.40. The monthly demand is 430 units for product K36L and 890 units for
W81H. The constrained resource is a particular machine that is available for 10,000 minutes each
month. Each unit of product K36L requires 15 minutes on this machine and each unit of product
W81H requires 8 minutes on this machine.
45. How many units of product K36L should be produced each month?
46. What is the maximum contribution margin the company can earn per month?
47. Up to how much should the company be willing to pay to obtain enough of the
constrained resource to satisfy demand for the two existing products?
