TRIM TRENDS EXCEL - Contribution per Unit of Constrained...

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Contribution per Unit of Constrained Resource (per unit) WLRM BB Target Price 100 50 Material Cost 60 15 Contribution Margin 40 35 Cont/DLH* 200 175 Cont/SUH** 160 700 Cont/MH*** 11 23 * WLRM: $40 / 0.2 labour hrs BB: $35 / 0.2 labour hrs ** WLRM: $40 / ( 2 setup hrs / 8 units move) BB: $35 / ( 2 setup hrs / 40 units move) *** WLRM: $40 / 3.5 machine hrs BB: $35 / 1.5 machine hrs
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Profit Results for Each Alternative Option Units Produced Profit WLRM BB 1 7500 0 300000 2 10000 0 140000 3 0 20000 580000 4 7500 20000 680000 5 10000 20000 695000 6 7500 0 300000 7 4000 20000 740000 8 8571 20000 662857
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Alternative 1 Incremental Revenue (target $100/unit) 750000 Incremental Fixed Costs (target $75/unit) Overhead 0 Labour 0 Materials 450000 Total ($60/unit) -450000 Incremental Profit 300000 Target Profit Margin 25% Actual Profit Margin 40%
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Alternative 2 Incremental Revenue (target $100/unit) 1000000 Incremental Fixed Costs (target $75/unit) Equipment Setup* 200000 Labour** 60000 Materials 600000 Total ($86/unit)
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This essay was uploaded on 03/18/2008 for the course COMM 308 taught by Professor Suresh during the Spring '07 term at University of Saskatchewan- Management Area.

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TRIM TRENDS EXCEL - Contribution per Unit of Constrained...

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