Morgan Inc. has 5,400 machine hours available each month. The following information on the company's three products is available:
$$\begin{array} { l r r r }
& \text { Product 1 } & \text { Product 2 } & \text { Product 3 } \
\text { Contribution margin per unit } & \$ 15.00 & \$ 1 8 . 00 & \$ 7 . 5 0\
\text { Machine hours per unit } & 3 & 2 & 1
\end{array}$$
If market demand exceeds the available capacity, in what sequence should orders be filled to maximize the company's profits?
A) Product 1 first, product 2 second, and product 3 third.
B) Product 2 first, product 3 second, and product 1 third.
C) Product 3 first, product 2 second, and product 1 third.
D) Product 3 first, product 1 second, and product 2 third.

Question

Morgan Inc. has 5,400 machine hours available each month. The following information on the company's three products is available:
$$\begin{array} { l r r r } 
& \text { Product 1 } & \text { Product 2 } & \text { Product 3 } \
\text { Contribution margin per unit } & \$ 15.00 & \$ 1 8 . 00  & \$ 7 . 5 0\
\text { Machine hours per unit } & 3 & 2 & 1
\end{array}$$
If market demand exceeds the available capacity, in what sequence should orders be filled to maximize the company's profits?
A) Product 1 first, product 2 second, and product 3 third.
B) Product 2 first, product 3 second, and product 1 third.
C) Product 3 first, product 2 second, and product 1 third.
D) Product 3 first, product 1 second, and product 2 third.

Quizplus · Accepted Answer

The Answer of Morgan Inc. has 5,400 machine hours available each month. The following information on the company's three products is available:
$$\begin{array} { l r r r } 
& \text { Product 1 } & \text { Product 2 } & \text { Product 3 } \
\text { Contribution margin per unit } & \$ 15.00 & \$ 1 8 . 00  & \$ 7 . 5 0\
\text { Machine hours per unit } & 3 & 2 & 1
\end{array}$$
If market demand exceeds the available capacity, in what sequence should orders be filled to maximize the company's profits?
A) Product 1 first, product 2 second, and product 3 third.
B) Product 2 first, product 3 second, and product 1 third.
C) Product 3 first, product 2 second, and product 1 third.
D) Product 3 first, product 1 second, and product 2 third.

Morgan Inc If Market Demand Exceeds the Available Capacity, in What Sequence