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1 5 Points One of your relatives is running a small factory in Manama. The factory makes only three products, A, B and C. Data
1 5 Points One of your relatives is running a small factory in Manama. The factory makes only three products, A, B and C. Data concerning the three products as follow (per unit): Product A Estimated customer 750 demand in units Selling price per unit. $90 Variable cost per unit $36 Machine-hours per unit 3 I Product B 650 Product C 850 $76 $55 $26 2.5 $19 1.5 Your relative told you that the available capacity of the machine is only 3,500 machine-hours available, and he faced a problem in meeting estimated customer demand and started thinking to lease additional machine to meet the customers' demand. Considering that you are studying Managerial Accounting this semester, how you can advise your relative in the following requirements Requirements 1-Calculate each product's contribution margin per unit of the constraining resource. 2- Calculate the machine-hours needed to meet demand for each product. 3- Calculate the highest possible total contribution margin that the factory can earn if it makes optimal use of its constraining resource. 4- Determine the product that the company is making when it runs out of machine-hours. Up to, how much should the factory be willing to pay per hour to lease additional machine capacity
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