Maximization of company operating margin

Reference no: EM13153817

North York Statue Company makes miniature Mountie statues from cast iron. Sales total 40,000 units a year. the statues are finished either rough or polished, with an average demand of 60 percent rough and 40 percent for polished. Iron ingots, the direct material, costs $6 per kilogram. Processing costs are $200 to convert 20 kilograms into 40 statues. Rough statues are sold for $15 each and polished statues can be sold for $18 or engraved for an additional cost of $5. Polished statues can then be sold for $30.

Required:

Determine the product mix for statues that allows maximization of the company's operating margin.

Reference no: EM13153817

Questions Cloud

Organizational culture is an externally imposed : Organizational culture is an externally imposed system of constraints on the behavior of suppliers in an organization.

What is the standard deviation of the complete portfolio : Consider the following capital market: a risk-free asset yielding 1.75% per year and a mutual fund consisting of 65% stocks and 35% bonds. The expected return on stocks is 12.50% per year and the expected return on bonds is 3.25% per year. The standa..

Total contribution margin-variable costing approach : Clubb Company, which has only one product, has provided the following data concerning its most recent month of operations: The total contribution margin for the month under the variable costing approach is:

Profit-sharing plans : Define and discuss profit-sharing plans and also the advantages. Additionally, critics of profit sharing plans maintain that these plans do not motivate employees to perform at higher levels. Under what conditions are profit sharing plans not likely ..

Maximization of company operating margin : Determine the product mix for statues that allows maximization of the company's operating margin.

What is the null hypothesis and expected value : A sociologist wanted to determine whether there was a difference in the amount of time children aged 5-7 spent watching tv. what is the null hypothesis? Find the expected value.

Outline a micro-economic reform issue : Outline a micro-economic reform issue that is relevant to the Australian economy market and how successful do you think these reform measures were and say why referring to some data or research that has been performed.

What was the perrcentage of h2o2 in the sample : If 43.2 ml of 0.105 M KMnO4 were required to reach the endpoint of a 14.8g bleach sample, what was the perrcentage of H2O2 in the sample?

Fixed- and variable-cost pools : Suppose fixed- and variable-cost pools were allocated separately. Specify how each pool should be allocated. Compute the cost allocated to the Public Works Department in August.

User Account

All Pages