Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown...

Product Decisions Under Bottlenecked Operations

Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $85,000 for the company as a whole. In addition, the following information is available about the three products:

	Large	Medium	Small
Unit selling price	$184		$160	$100
Unit variable cost	130		120	76
Unit contribution margin	$ 54		$ 40	$ 24
Autoclave hours per unit	3		2	1
Total process hours per unit	5		4	2
Budgeted units of production	3,000		3,000	3,000

a.Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production. Round the "Unit contribution margin per production bottleneck hour" amounts to the nearest cent.

	Large	Medium	Small	Total
Units produced	fill in the blank 1	fill in the blank 2	fill in the blank 3
Revenues	$fill in the blank 4	$fill in the blank 5	$fill in the blank 6	$fill in the blank 7
Less: Variable costs	fill in the blank 8	fill in the blank 9	fill in the blank 10	fill in the blank 11
Contribution margin	$fill in the blank 12	$fill in the blank 13	$fill in the blank 14	$fill in the blank 15
Less: Fixed costs				fill in the blank 16
Income from operations				$fill in the blank 17

b.Prepare an analysis showing which product is the most profitable per bottleneck hour.

	Large	Medium	Small
Unit contribution margin	$fill in the blank 18	$fill in the blank 19	$fill in the blank 20
Autoclave hours per unit	fill in the blank 21	fill in the blank 22	fill in the blank 23
Unit contribution margin per production bottleneck hour	$fill in the blank 24	$fill in the blank 25	$fill in the blank 26

Jun 10, 2022

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Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown...

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