Question

Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...

Product Decisions Under Bottlenecked Operations

Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $115,000 for the company as a whole. In addition, the following information is available about the three products:

   Large    Medium    Small
Unit selling price $169 $297 $174
Unit variable cost 133 243 153
Unit contribution margin $ 36 $ 54 $ 21
Autoclave hours per unit 4 6 2
Total process hours per unit 12 18 4
Budgeted units of production 2,300 2,300 2,300

a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production.

Large      Medium      Small      Total     
Units produced
Revenues $ $ $ $
Variable costs
Contribution margin $ $ $ $
Fixed costs
Income from operations $

b. Prepare an analysis showing which product is the most profitable per bottleneck hour. Round the "Unit contribution margin per production bottleneck hour" amounts to the nearest cent.

Large     Medium     Small    
Contribution margin $ $ $
Autoclave hours per unit
Unit contribution margin per production bottleneck hour $ $ $

Homework Answers

Answer #1

--[a]

Large      Medium      Small      Total     
Units produced 2300 2300 2300
Revenues $388,700 $683,100 $400,200 $1,472,000
Variable costs $305,900 $558,900 $351,900 $1,216,700
Contribution margin $82,800 $124,200 $48,300 $255,300
Fixed costs $115,000
Income from operations $140,300

--[b]

Large     Medium     Small    
A Contribution margin $36.00 $54.00 $21.00
B Autoclave hours per unit 4 6 2
C = A/B Unit contribution margin per production bottleneck hour $9.00 $9.00 $10.50
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $250,000 for the company as a whole. In addition, the following information is available about the three...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $210,000 for the company as a whole. In addition, the following information is available about the three...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $235,000 for the company as a whole. In addition, the following information is available about the three...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $217,000 for the company as a whole. In addition, the following information is available about the three...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $85,000 for the company as a whole. In addition, the following information is available about the three...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $85,000 for the company as a whole. In addition, the following information is available about the three products:...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $114,000 for the company as a whole. In addition, the following information is available about the three products:...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $244,000 for the company as a whole. In addition, the following information is available about the three products:...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a A condition that occurs when product demand exceeds production capacity.production bottleneck. Total fixed costs are $104,000 for the company as a whole. In...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large,...
Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $239,000 for the company as a whole. In addition, the following information is available about the three...