Question
ABC Corp produces three products, with costs and selling prices as follows: Product A Product B Product C Selling price per unit............... $50 100% $20
ABC Corp produces three products, with costs and selling prices as follows:
|
| Product A | Product B | Product C | ||||
| Selling price per unit............... | $50 | 100% | $20 | 100% | $15 | 100% | |
| Variable costs per unit............. | 30 | 60% | 15 | 75% | 6 | 40% | |
| Contribution margin per unit.. | $20 | 40% | $ 5 | 25% | $ 9 | 60% | |
A particular machine is a bottleneck. On that machine, 7 machine hours are required to produce each unit of Product A, 2 hour is required to produce each unit of Product B, and 3 hours are required to produce each unit of Product C. In which order should it produce its products?
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Managerial Accounting
Authors: John J. Wild, Ken W. Shaw
2010 Edition
9789813155497, 73379581, 9813155493, 978-0073379586
