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Bahrain Rubber Company (BRC) manufactures a line of speed bumps. Demand for the compatry's products is increasing, and get pet istance from, yeni determining an
Bahrain Rubber Company (BRC) manufactures a line of speed bumps. Demand for the compatry's products is increasing, and get pet istance from, yeni determining an econical sales and production mix for the coming year The company provided the following data Product Demand next year(s) Selling price Direct materials Direct labor Direct labor hours per unit The following additional information is available Small bange ve 50,000 $1620 54.30 56.40 0.40 33.000 5765 36.44 $11.20 0.70 325,000 ww 53.20 $120 03 The company's plant has a capacity 99,000 direct labor-hours per year on a single shift basis. The company's present employees and equipment can produce all three products b. The direct labor rate of $16 per hour is expected to remain unchanged during the coming year. c. Fixed cost total $520,000 per year. Variable overhead costs are $2 per direct labor-hour d. All the company's nonmanufacturing costs are fixed. Required 1. How much variable overhead cost is incurred to manufacture one unit of each of the company's three products? 2. Assuming that direct labor-hours is the company's constraining resource, what is the contribution margin per direct labor-hour for each of the company's three products? Rank them in terms of profitability? 3. Which product has the largest contribution margin per unit? Why wouldn't this product be the most profitable use of the constrained resource in either case? E10(Mack Activate Windows activate W
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