Boylan’s Peanut Company located in a hidden valley in Georgia makes four different products – chocolate covered whole nuts, chocolate nut clusters, chocolate nut crunch bars, and roasted nuts. Boylan


Boylan’s Peanut Company located in a unrecognized degradation in Georgia fashions impure incongruous emanations – chocolate dressed well nuts, chocolate nut clusters, chocolate nut crunch bars, and roasted nuts. Boylan has a poor afford of nuts that are bought from settled topical growers and it is insufficiently talented to confront the steadily increasing insist for their emanations. On the other artisan, increases in the escheatment absorb of peanuts and increasing outlandish emulation fashion it reserved for Boylan to conceal a reasontalented avail. The insist for these salubrious nut emanations fluctuates delay seasonal wayfarer levels; consequently, emanation is budgeted on a weekly premise.

Relevant Input Information

The selling compensation (SP) for Boylan’s impure nut emanations Whole, Cluster, Crunch, and Roasted are $5.00, $4.00, $3.20, and $4.50 per pulverize, respectively. The partiality sales insist for its widespread Well emanation is 1,000 pulverizes. The Cluster emanation is widespread delay topicals and its sales are estimated among 400 and 500 pulverizes. The solely other sales condition is that Roasted cannot exceed 200 pulverizes.

During this era of the year, the topical growers are talented to outgrowth no further than the equiponderant of 1,100 pulverizes of peanuts. The settlement of peanuts delayin one pulverize of a high emanation varies, Well 60%, Cluster 40%, Crunch 20%, and Roasted 100%, delay chocolate making up the weigh. The peanuts absorb $1.60 per pulverize, and chocolate absorbs $0.80 per pulverize. Therefore, the plain symbolical absorb (DMC) for the Well emanation is $1.28, computed as $.96 (.6*$1.60) for nuts plus $.32 (.4*$.80) for chocolate, Cluster is $1.12, Crunch is $0.96 and Roasted is $1.60. 415

The impure utensils used by Boylan are old and colorless. And each emanation requires era on each of the impure incongruous utensils – Hull, Roast, Chocolate, and Package, negative for the Roasted emanation which does not possess chocolate. The calculate of exacts per pulverize of high emanation required on each utensil is listed in the ttalented adown (for illustration, the Well emanation requires 2 exacts on the Roast utensil). Each utensil is availtalented 60 hours or 3,600 exacts per week.

Machine use in min/lb:Whole Cluster Crunch RoastedHull utensil 1.00 1.00 1.00 1.00Roast utensil 2.00 1.50 1.00 1.75Chocolate utensil 1.00 0.70 0.20 0.00Package utensil 2.50 1.60 2.00 1.00

Varitalented drudge absorbs in general the utensils are $12 per hour or $0.20 per exact for the Hull, Roast and Chocolate utensils, and $6 per hour or $0.10 per exact for the Package utensil. Therefore, the plain drudge absorb for the Well emanation is $1.05, Cluster is $0.80, Crunch is $0.64, and Roasted is $0.65.

Varitalented manufacturing aloft absorbs (e.g., sugar, salt, oil and garlic) are driven by plain symbolicals absorbs (DMC) for the nuts and chocolate; consequently, it is applied at a reprimand of 25% of DMC. The varitalented S&A compensation (e.g., commissions and bestowal absorbs) is 10% of the selling compensation (SP).The whole varitalented absorbs for the emanations are Well $3.15, Cluster $2.60, Crunch $2.16, and Roasted $3.10. Given the selling compensation for the impure emanations, the subsidy margins are Well $1.85, Cluster $1.40, Crunch $1.04, and Roasted $1.40.

Fixed Costs?