Determining the Optimal Product Mix with One Constrained Resource and a Sales Constraint Casual Essentials, Inc. manufactures two types of team shirts, the Homerun and the Goalpost, with unit contribution margins of $5 and $15, respectively. Regardless of type, each team shirts must be fed through a stitching machine to affix the appropriate team logo. The firm leases seven machines that each provides 1,000 hours of machine time per year. Each Homerun shirt requires 6 minutes of machine time, and each Goalpost shirt requires 30 minutes of machine time. Assume that a maximum of 50,060 units of each team shirts can be sold. Required: If required, round your answers to the nearest whole number. 1. What is the contribution margin per hour of machine time for each type of team shirts? Contribution Margin Homerun $fill in the blank 1 Goalpost $fill in the blank 2 2. What is the optimal mix of team shirts? Optimal Mix Homerun fill in the blank 3 units Goalpost fill in the blank 4 units 3. What is the total contribution margin earned for the optimal mix? $fill in the blank 5
Determining the Optimal Product Mix with One Constrained Resource and a Sales Constraint
Casual Essentials, Inc. manufactures two types of team shirts, the Homerun and the Goalpost, with unit contribution margins of $5 and $15, respectively. Regardless of type, each team shirts must be fed through a stitching machine to affix the appropriate team logo. The firm leases seven machines that each provides 1,000 hours of machine time per year. Each Homerun shirt requires 6 minutes of machine time, and each Goalpost shirt requires 30 minutes of machine time.
Assume that a maximum of 50,060 units of each team shirts can be sold.
Required:
If required, round your answers to the nearest whole number.
1. What is the contribution margin per hour of machine time for each type of team shirts?
| Contribution Margin | |
| Homerun | $fill in the blank 1 |
| Goalpost | $fill in the blank 2 |
2. What is the optimal mix of team shirts?
| Optimal Mix | |
| Homerun | fill in the blank 3 units |
| Goalpost | fill in the blank 4 units |
3. What is the total contribution margin earned for the optimal mix?
$fill in the blank 5
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