Blossom, Incorporated, is a small company that manufactures three versions of patio tables. Unit information for its products follows: Sales price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Required number of labor hours Required number of machine hours. Table B Table C Table A $ 49 9 2 4 8 50,000 units 25,000 units 25,000 units 0.50 4.00 Table B $ 53 10 4 4 8 0.50 2.50 Complete this question by entering your answers in the tabs below. Table C $67 11 Blossom has determined it can sell a limited number of each table in the upcoming year. Expected demand for each model follows: Table A 8 4 8 1.00 2.00 Required: 1. Suppose direct labor hours have been identified as the bottleneck resource. Determine how Blossom should prioritize production by rank, i.e., ordering the products from 1 to 3. 2. If Blossom has only 50,000 direct labor hours available, calculate the number of units of each table Blossom should produce to maximize its profit. 3. Suppose the number of machine hours has been identified as the most constrained resource. Determine how Blossom should prioritize production by rank, i.e., ordering the products from 1 to 3. 4. If Blossom has only 241,000 machine hours available, calculate the number of units of each table Blossom should produce to maximize its profit.
Blossom, Incorporated, is a small company that manufactures three versions of patio tables. Unit information for its products follows: Sales price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Required number of labor hours Required number of machine hours. Table B Table C Table A $ 49 9 2 4 8 50,000 units 25,000 units 25,000 units 0.50 4.00 Table B $ 53 10 4 4 8 0.50 2.50 Complete this question by entering your answers in the tabs below. Table C $67 11 Blossom has determined it can sell a limited number of each table in the upcoming year. Expected demand for each model follows: Table A 8 4 8 1.00 2.00 Required: 1. Suppose direct labor hours have been identified as the bottleneck resource. Determine how Blossom should prioritize production by rank, i.e., ordering the products from 1 to 3. 2. If Blossom has only 50,000 direct labor hours available, calculate the number of units of each table Blossom should produce to maximize its profit. 3. Suppose the number of machine hours has been identified as the most constrained resource. Determine how Blossom should prioritize production by rank, i.e., ordering the products from 1 to 3. 4. If Blossom has only 241,000 machine hours available, calculate the number of units of each table Blossom should produce to maximize its profit.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 5CE: Roberts Company produces two weed eaters: basic and advanced. The company has four activities:...
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Transcribed Image Text:Blossom, Incorporated, is a small company that manufactures three versions of patio tables. Unit information for its products follows:
Sales price
Direct materials
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead
Required number of labor hours
Required number of machine hours
Required 1 Required 2
Table A
$49
9
2
4
8
Complete this question by entering your answers in the tabs below.
0.50
4.00
Required 3 Required 4
Product
Table B
$53
10
4
4
8
Blossom has determined it can sell a limited number of each table in the upcoming year. Expected demand for each model follows:
Table A
50,000 units
25,000 units
25,000 units
Table C
Table B
Table A
Table B
Table C
Required:
1. Suppose direct labor hours have been identified as the bottleneck resource. Determine how Blossom should prioritize production
by rank, i.e., ordering the products from 1 to 3.
2. If Blossom has only 50,000 direct labor hours available, calculate the number of units of each table Blossom should produce to
maximize its profit.
3. Suppose the number of machine hours has been identified as the most constrained resource. Determine how Blossom should
prioritize production by rank, i.e., ordering the products from 1 to 3.
4. If Blossom has only 241,000 machine hours available, calculate the number of units of each table Blossom should produce to
maximize its profit.
0.50
2.50
Units Produced
31,000
30,000
31,000
Table C
$ 67
11
8
4
8
1.00
2.00
If Blossom has only 241,000 machine hours available, calculate the number of units of each table Blossom should produce to
maximize its profit.
Note: Enter the products in the sequence of their preferences; the product with first preference should be entered first.
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