Baker Company manufactures three products: A, B and C. The selling price, variable costs and contribution...
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Baker Company manufactures three products: A, B and C. The selling price, variable costs and contribution margin for one unit of each product follow: A Product B C Selling price Less: Variable expenses: Direct materials $131.00 $180.00 $175.00 21.00 67.00 48.00 Direct labour 14.20 14.20 14.20 Other variable expenses 63.50 44.00 72.25 Total variable expenses 98.70 125.20 134.45 Contribution margin $ 32.30 $ 54.80 $ 40.55 The same raw material is used in all three products and costs $4 per kilogram. Baker Company has only 8,500 kilograms of material on hand and will not be able to obtain any more material for several weeks due to a strike in its supplier's plant. Management is tryin to decide which product(s) to concentrate on next week in filling its backlog of orders. Direct labour costs $19 per hour. Required: 1. Compute the amount of contribution margin that will be obtained per kilogram of material used in each product. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Baker Company manufactures three products: A, B and C. The selling price, variable costs and contribution margin for one unit of each product follow: A Product B C Selling price Less: Variable expenses: Direct materials $131.00 $180.00 $175.00 21.00 67.00 48.00 Direct labour 14.20 14.20 14.20 Other variable expenses 63.50 44.00 72.25 Total variable expenses 98.70 125.20 134.45 Contribution margin $ 32.30 $ 54.80 $ 40.55 The same raw material is used in all three products and costs $4 per kilogram. Baker Company has only 8,500 kilograms of material on hand and will not be able to obtain any more material for several weeks due to a strike in its supplier's plant. Management is tryin to decide which product(s) to concentrate on next week in filling its backlog of orders. Direct labour costs $19 per hour. Required: 1. Compute the amount of contribution margin that will be obtained per kilogram of material used in each product. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
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