Roberta’s Robots Ltd. manufactures three different models -basic, enhanced, and deluxe. Considerable market demand exists for all models. The…
1. Roberta’s Robots Ltd. manufactures three different models –basic, enhanced, and deluxe. Considerable market demand exists for all models. The following per unit data apply: Basic Enhanced Deluxe Selling price $400 $500 $600 Direct materials 100 150 200 Direct labor ($20 per hour) 40 50 60 Variable support costs ($4 per machine hour) 80 60 100 Fixed support costs 60 60 60 Gross profit $120 $180 $180 Required: If there is no excess machine capacity, which model(s) should the company produce to maximize profits? Why? […]