Block Corporation makes three products that use the current constraint, which is
ID: 2483994 • Letter: B
Question
Block Corporation makes three products that use the current constraint, which is a particular type of machine. Data concerning those products appear below:
Rank the products in order of their current profitability from the most profitable to the least profitable. In other words, rank the products in the order in which they should be emphasized. (Round your intermediate calculations to 2 decimal places.)
Assume that sufficient constraint time is available to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource? (Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.)
Explanation / Answer
ZA
JK
DH
Selling price unit
326.35
543.61
497.00
Less- Variable cost per unit
251.93
420.74
397.59
Contribution per unit
74.42
122.87
99.41
Labor time
2.8
6.8
8
Contribution per labor minute
26.57857
18.06912
12.42625
Ranking
ZA
FIRST
JK
SECOND
DH
THIRD
ZA
JK
DH
Selling price unit
326.35
543.61
497.00
Less- Variable cost per unit
251.93
420.74
397.59
Contribution per unit
74.42
122.87
99.41
Labor time
2.8
6.8
8
Contribution per labor minute
26.57857
18.06912
12.42625