Assuming that Barlow's estimated customer demand is 500 units per product line what is the maximum contribution margin the company can earn when using the 6000 pound of raw material on hand??

work mode : This shows what is correct or incorrect Return to question Product A B C Selling price $ 180 $ 270 $ 240 Variable expenses : Direct materials 24 80 32 Other variable expenses 102 90 148 Total variable expenses 126 170 180 Contribution margin $ 54 $ 100 $ 60 Contribution margin ratio 30% 37% 25% The same raw material is used in all three products. Barlow Company has only 6,000 pounds of raw material on hand and will no be able to obtain any more of it for several weeks due to a strike in its supplier's plant. Management is trying to decide which product(s) to concentrate on next week in filling its backlog of orders. The material costs $8 per pound. Required: 1. Calculate the contribution margin per pound of the constraining resource for each product. 2. Assuming that Barlow has unlimited demand for each of its three products, what is the maximum contribution margin the company can earn when using the 6,000 pounds of raw material on hand? 3. Assuming that Barlow's estimated customer demand is 500 units per product line, what is the maximum contribution margin the company can earn when using the 6.000 pounds of raw material on hand? Prev 1 of 2 Next >