Bruce Corporation makes four products in a single facility. These products have

Question

Bruce Corporation makes four products in a single facility. These products have the following unit product costs: Products A B C D Direct materials $ 19.90 $ 15.20 $ 20.80 $ 23.20 Direct labor 12.20 8.70 10.50 7.40 Variable manufacturing overhead 1.60 2.10 2.00 2.10 Fixed manufacturing overhead 10.80 11.90 8.80 10.70 Unit product cost $ 44.50 $ 37.90 $ 42.10 $ 43.40 Additional data concerning these products are listed below. Products A B C D Grinding minutes per unit 1.20 0.70 0.60 0.60 Selling price per unit $ 59.30 $ 51.70 $ 59.50 $ 55.60 Variable selling cost per unit $ 3.60 $ 1.50 $ 2.20 $ 3.60 Monthly demand in units 4,000 2,000 4,000 2,000 The grinding machines are potentially the constraint in the production facility. A total of 9,800 minutes are available per month on these machines. Direct labor is a variable cost in this company. How many minutes of grinding machine time would be required to satisfy demand for all four products? 10,800 9,800 10,500 12,000

Explanation / Answer

How many minutes of grinding machine time would be required to satisfy the demand for all four products?

Answer is 9800 Minutes

A B C D Total Monthly demand 4000 2000 4000 2000 Grinding minutes per unit 1.2 0.7 0.6 0.6 Total Minutes Required Per Each Product 4800 1400 2400 1200 9800

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