Sales Mix Decision SE8 Blizzard Inc makes three kinds of sno

Sales Mix Decision SE8. Blizzard, Inc., makes three kinds of snowboards, but it has a limited number of machine hours available to make them. Product linc data are as follows Wood 1.25 100 $45 $15 Plastic 1.0 $120 $50 $26 Graphite Machine hours per unit Selling price per unit Variable manufacturing cost per unit Variable selling costs per unit $200 $100 537 In what order should the snowboard product lines be produced?

Solution

Wood Plastic Graphite Selling price per unit 100 120 200 Variable manufacturing cost per unit 45 50 100 Variable selling costs per unit 15 26 37 Contribution margin per unit 40 44 63 Machine hours per unit 1.25 1 1.5 Contribution margin per machine hour 32 44 42 Order of Production: Plastic Graphite Wood