1. What is the gross margin per minute of plugs manufactured? A) $0.73 B) $0.60

Question

1. What is the gross margin per minute of plugs manufactured?

A) $0.73

B) $0.60

C) $0.27

D) $0.40

2. What is the maximum possible production of rails based on the machine capacity?

A) 125,000.00

B) 250,000.00

C) 83,333.33

D) 166,666.67

3. What is the total profit generated from the manufactured of only plugs?

A) $66,66.67

B) $100,000.00

C) $150,000.00

D) $183,333.33

Use the following information to answer the question(s) below. Cerebro Manufacturing produces four types of structural support fittings-plugs, rails, rivets, and clips-which are machined on two CNC machining centers. The machining centers have a capacity of 250,000 minutes per year. The gross margin per unit and machining requirements are shown in the spreadsheet below. 1) Cerebro Manufacturing Model Machine (mins./year) 250,000 Plugs Rails Rivets Clips Capacity Gross margin/unit Minutes/unit S 0.40$1.20 S 0.80 S 1.10 1.4 Maximum production

Explanation / Answer

Gross margin/unit = 0.4
Minutes/unit = 1

Gross margin/minute = [Gross margin/unit] / [Minutes/unit] = 0.4/1 = $0.4(Option D)

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