Leach Finishing makes various metal fittings for the construction industry. Three of the fittings, models X-12, X-24, and X-30, require grinding on a patented machine of which Leach has only one. The cost of production information for the three products follow: X-12 $ 35 $ 20 18.0 X-24 $51 $ 27 12.5 X-30 Price per fitting Variable cost per fitting Units per hour of grinding The testing machine used for both models has a capacity of 3,230 hours annually. Fixed manufacturing costs are $496,000 annually. $70 $44 10.0 Required: a. Suppose that Leach Finishing can sell at most 59,200 units of any one fitting. How many units of each fitting model should Leach Finishing produce annually? b. Suppose that Leach Finishing can sell at most 18,000 units of any one fitting. How many units of each fitting should Leach Finishing produce annually?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Leach Finishing manufactures various metal fittings for the construction industry. These fittings, identified by models X-12, X-24, and X-30, require processing on a patented machine, which Leach possesses only one of. Below is the cost of production information for these products:

|          | X-12 | X-24 | X-30 |
|----------|------|------|------|
| **Price per fitting**      | $35  | $51  | $70  |
| **Variable cost per fitting** | $20  | $27  | $44  |
| **Units per hour of grinding** | 18.0 | 12.5 | 10.0 |

The testing machine operates for both models with an annual capacity of 3,230 hours. The fixed manufacturing costs amount to $496,000 per year.

**Required:**

a. If Leach Finishing can sell a maximum of 59,200 units of any one fitting, how many units of each fitting model should be produced annually?

b. If Leach Finishing can sell a maximum of 18,000 units of any one fitting, how many units of each fitting model should be produced annually?

**Instructions:** Complete this question by entering your answers in the tabs below.

- **Required A:** Input the number of units for each fitting model given the constraint of selling at most 59,200 units of any one fitting annually.

  - X-12: ___ units
  - X-24: ___ units
  - X-30: ___ units

- **Required B:** Input the number of units for each fitting model given the constraint of selling at most 18,000 units of any one fitting annually.
Transcribed Image Text:Leach Finishing manufactures various metal fittings for the construction industry. These fittings, identified by models X-12, X-24, and X-30, require processing on a patented machine, which Leach possesses only one of. Below is the cost of production information for these products: | | X-12 | X-24 | X-30 | |----------|------|------|------| | **Price per fitting** | $35 | $51 | $70 | | **Variable cost per fitting** | $20 | $27 | $44 | | **Units per hour of grinding** | 18.0 | 12.5 | 10.0 | The testing machine operates for both models with an annual capacity of 3,230 hours. The fixed manufacturing costs amount to $496,000 per year. **Required:** a. If Leach Finishing can sell a maximum of 59,200 units of any one fitting, how many units of each fitting model should be produced annually? b. If Leach Finishing can sell a maximum of 18,000 units of any one fitting, how many units of each fitting model should be produced annually? **Instructions:** Complete this question by entering your answers in the tabs below. - **Required A:** Input the number of units for each fitting model given the constraint of selling at most 59,200 units of any one fitting annually. - X-12: ___ units - X-24: ___ units - X-30: ___ units - **Required B:** Input the number of units for each fitting model given the constraint of selling at most 18,000 units of any one fitting annually.
Leach Finishing makes various metal fittings for the construction industry. Three of the fittings, models X-12, X-24, and X-30, require grinding on a patented machine of which Leach has only one. The cost of production information for the three products is as follows:

|       | X-12 | X-24 | X-30 |
|-------|------|------|------|
| **Price per fitting** | $35  | $51  | $70  |
| **Variable cost per fitting** | $20  | $27  | $44  |
| **Units per hour of grinding** | 18.0 | 12.5 | 10.0 |

The testing machine used for all models has a capacity of 3,230 hours annually. Fixed manufacturing costs are $496,000 annually.

### Required:
a. Suppose that Leach Finishing can sell at most 59,200 units of any one fitting. How many units of each fitting model should Leach Finishing produce annually?

b. Suppose that Leach Finishing can sell at most 18,000 units of any one fitting. How many units of each fitting should Leach Finishing produce annually?

### Instructions:
Complete this question by entering your answers in the tabs below.

**Tab: Required B**

Suppose that Leach Finishing can sell at most 18,000 units of any one fitting. How many units of each fitting should Leach Finishing produce annually?

- **X-12:** ___ units
- **X-24:** ___ units
- **X-30:** ___ units

(Note: Be sure to calculate based on the given constraints and production information.)
Transcribed Image Text:Leach Finishing makes various metal fittings for the construction industry. Three of the fittings, models X-12, X-24, and X-30, require grinding on a patented machine of which Leach has only one. The cost of production information for the three products is as follows: | | X-12 | X-24 | X-30 | |-------|------|------|------| | **Price per fitting** | $35 | $51 | $70 | | **Variable cost per fitting** | $20 | $27 | $44 | | **Units per hour of grinding** | 18.0 | 12.5 | 10.0 | The testing machine used for all models has a capacity of 3,230 hours annually. Fixed manufacturing costs are $496,000 annually. ### Required: a. Suppose that Leach Finishing can sell at most 59,200 units of any one fitting. How many units of each fitting model should Leach Finishing produce annually? b. Suppose that Leach Finishing can sell at most 18,000 units of any one fitting. How many units of each fitting should Leach Finishing produce annually? ### Instructions: Complete this question by entering your answers in the tabs below. **Tab: Required B** Suppose that Leach Finishing can sell at most 18,000 units of any one fitting. How many units of each fitting should Leach Finishing produce annually? - **X-12:** ___ units - **X-24:** ___ units - **X-30:** ___ units (Note: Be sure to calculate based on the given constraints and production information.)
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