Trim Trends Appendices

Contribution per Unit of Constrained Resource

(per unit) Target Price Material Cost Contribution Margin Cont/DLH* Cont/SUH** Cont/MH***

WLRM

BB 100 60 40 200 160 11

50 15 35 175 700 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

Profit Results for Each Alternative Option 1 2 3 4 5 6 7 8

Units Produced Profit WLRM BB 7500 0 300000 10000 0 140000 0 20000 580000 7500 20000 680000 10000 20000 695000 7500 0 300000 4000 20000 740000 8571 20000 662857

Alternative 1 Incremental Revenue (target $100/unit) Incremental Fixed Costs (target $75/unit) Overhead Labour Materials Total ($60/unit) Incremental Profit Target Profit Margin 25% Actual Profit Margin 40%

750000 0 0 450000 -450000 300000

Alternative 2 Incremental Revenue (target $100/unit) Incremental Fixed Costs (target $75/unit) Equipment Setup* Labour** Materials Total ($86/unit) Incremental Profit Target Profit Margin 25% Actual Profit Margin 14% *625 additional setup hours required **500 additional labour hours required

1000000 200000 60000 600000 -860000 140000

Alternative 3 Incremental Revenue (target $50/unit) Incremental Fixed Costs (target $15/unit) Labour* Materials Total ($21/unit) Incremental Profit Target Profit Margin 25% Actual Profit Margin 58% *2500 additional labour hours required

1000000 120000 300000 -420000 580000

Alternative 4

Incremental Revenue Incremental Material Cost Contribution Margin Incremental Other Costs Equipment Setup* Labour*** Total Incremental Profit

WLRM 750000 -450000 300000

*875 additional setup hours required **4000 additional labour hours required

BB Total 1000000 1750000 -300000 -750000 700000 1000000 200000 120000 -320000 680000

Alternative 5

Incremental Revenue Incremental Material Cost Contribution Margin Incremental Other Costs Equipment Setup* Product Machining** Labour*** Total Incremental Profit

WLRM 1000000 -600000 400000

*1500 additional setup hours required **5000 additional machine hours required ***4500 additional labour hours required

BB Total 1000000 2000000 -300000 -900000 700000 1100000 200000 25000 180000 -405000 695000

Alternative 7 (Machine Hours as Constraint)

Incremental Revenue Incremental Material Cost Contribution Margin Incremental Other Costs Equipment Setup* Labour** Total Incremental Profit

WLRM 857100 -514260 342840

*1144 additional setup hours required **4214 additional labour hours required

BB Total 1000000 1857100 -300000 -814260 700000 1042840 200000 180000 -380000 662840

Alternative 8 (Setup Hours as Constraint)

Incremental Revenue Incremental Material Cost Contribution Margin Incremental Other Costs Labour* Total Incremental Profit

WLRM 400000 -240000 160000

*3300 additional labour hours required

BB Total 1000000 1400000 -300000 -540000 700000 860000 120000 -120000 740000