XYZ Drinks makes three products: iced tea, soda, and lemonade. The following data are available: Iced Tea Soda Lemonade Sales price per unit P9.00 P6.00 P5.00 Variable cost per unit 3.00 1.50 1.00 Contribution margin per unit P6.00 P4.50 P4.00 XYZ is experiencing a bottleneck in one of its processes that affects each product as follows: Iced Tea Soda Lemonade Bottleneck process hours per unit 3 3 4 The business cannot vary the selling price of Iced Tea and Lemonade. In determining the optimal production plan, what is the order of priority?
XYZ Drinks makes three products: iced tea, soda, and lemonade. The following data are available: Iced Tea Soda Lemonade Sales price per unit P9.00 P6.00 P5.00 Variable cost per unit 3.00 1.50 1.00 Contribution margin per unit P6.00 P4.50 P4.00 XYZ is experiencing a bottleneck in one of its processes that affects each product as follows: Iced Tea Soda Lemonade Bottleneck process hours per unit 3 3 4 The business cannot vary the selling price of Iced Tea and Lemonade. In determining the optimal production plan, what is the order of priority?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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XYZ Drinks makes three products: iced tea, soda, and lemonade. The following data are available:
|
|
Iced Tea |
Soda |
Lemonade |
|
Sales price per unit |
P9.00 |
P6.00 |
P5.00 |
|
Variable cost per unit |
3.00 |
1.50 |
1.00 |
|
Contribution margin per unit |
P6.00 |
P4.50 |
P4.00 |
XYZ is experiencing a bottleneck in one of its processes that affects each product as follows:
|
|
Iced Tea |
Soda |
Lemonade |
|
Bottleneck process hours per unit |
3 |
3 |
4 |
The business cannot vary the selling price of Iced Tea and Lemonade.
In determining the optimal production plan, what is the order of priority?
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