A severe shortage of plastic pellets has required the

Assignment Help Accounting Basics

Reference no: EM13572498

Sport Luggage Inc. makes high-end hard-sided luggage for sports equipment. Data concerning three of the company's most popular models appear below.

	Ski Vault		Golf Caddy		Fishing Quiver
Selling price per unit	$	260	$	330	$	205
Variable cost per unit	$	120	$	180	$	135
Plastic injection molding machine processing time required to produce one unit	9 minutes		12 minutes		11 minutes
Pounds of plastic pellets per unit	12 pounds		7 pounds		11 pounds

Required:
1a.	The total time available on the plastic injection molding machine is the constraint in the production process. What is contribution margin per unit of the constrained resources for Ski Vault, Golf Caddy and Fishing Quiver? (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

	Ski Vault		Golf Caddy		Fishing Quiver
Contribution margin	$	per minute	$	per minute	$	per minute

1b.

Which product would be the most profitable use of this constraint?

	Ski Vault
	Fishing Quiver
	Golf Caddy

1c.

Which product would be the least profitable use of this constraint?

	Ski Vault
	Fishing Quiver
	Golf Caddy

2a.

A severe shortage of plastic pellets has required the company to cut back its production so much that the plastic injection molding machine is no longer the bottleneck. Instead, the constraint is the total available pounds of plastic pellets. What is contribution margin per unit of the constrained resources for Ski Vault, Golf Caddy and Fishing Quiver? (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

	Ski Vault		Golf Caddy		Fishing Quiver
Contribution margin	$	per pound	$	per pound	$	per pound

2b.

Which product would be the most profitable use of this constraint?

	Golf Caddy
	Fishing Quiver
	Ski Vault

2c.

Which product would be the least profitable use of this constraint?

	Golf Caddy
	Fishing Quiver
	Ski Vault

Which product has the largest unit contribution margin?

	Golf Caddy
	Fishing Quiver
	Ski Vault

Reference no: EM13572498

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