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This questtion is 1 to 3, i attached pictures of options for question 1 please enlarge it to view them.- X More Info Data Table th that hour. Fi two sizes only 3,40 þperating þins is limite Large optimal pd $ Organize It Operati

Organize It produces plastic storage bins for household storage needs. The company makes two sizes of bins: Large (200 L) and

2. Given this product mix, what will be the companys operating income? Organize It Operating Income from Product Mix Regular3. Explain why the operating income is less than it was when Organize It was producing its optimal product mix. Operating inc

please all data in the blue box are included.

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Answer #1
1
Regular Large Total
Contribution Margin per hour 78.20 63.60
Rank based on Contribution Margin per hour 1 2 Should emphasise Regular Bins as they are contributing more than Large Bins with machine hours as constraints
No. of Hours 3,400
No.of Units in an hour 17 12
Demand 27,200 25,000
No. of Hours required 1,600
Balance Hours 1,800
No. of Units to be produced 27,200 21,600 48,800 Optimal Product Mix
2
Operating Income from Product Mix
Regular Large Total
No. of Units 27,200 21,600 48,800
Contribution Margin per unit 4.60 5.30
Contribution Margin 125,120 114,480 239,600
Less Fixed Expenses 105,000
Operating Income 134,600
3
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