Managerial Acounting Discussion unit 4

Discussion Topic 

This will be a collaborative project to be completed as a small team. Main responses should be posted no later than Saturday. Plan to participate and contribute to the project on at least 3 separate days during the week. By the end of the week, one team member must post the team's final draft. On the final draft, please include the names of all team members who contributed substantially to the project. Please submit the final draft as a Word document in a thread beginning "Final Draft." 

This Teamwork Assignment is adapted from BYP6-7, Communication Activity, on pp. 288 of your textbook. 
“Easton Corporation makes two different boat anchors — a traditional fishing anchor and a high-end yacht anchor — using the same production machinery. The contribution margin of the yacht anchor is three times as high as that of the other product. The company is currently operating at full capacity and has been doing so for nearly 2 years. Bjorn Borg, the company’s CEO, want to cut back on production of the fishing anchor so that the company can make more yacht anchors. He says that this is a “no-brainer” because the contribution margin of the yacht anchor is so much higher.”

(Weygandt, Kimmel, & Kieso, 2012). 

Instructions:
As a team, explore the factors that Easton management should consider before making their final decision. Write a 1-page memo to Bjorn Borg describing the analysis that the company should perform. Be sure to address the following in your analysis: 

• What role might contribution margin per unit of limited resource play in this decision? 
• Should the marketing department be involved in the decision-making process? How important is consumer demand? 
• Should the company consider expanding their production facilities or purchasing additional equipment? 
• How might this change affect their company brand or the customer's perception of their brand? Will they be appealing to a different market by only offering yacht anchors?