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. Because of limited production capacity the Northeast Division of a pharmaceutical company needs to prioritize the production of the two most profitable drugs. The
. Because of limited production capacity the Northeast Division of a pharmaceutical company needs to prioritize the production of the two most profitable drugs. The controller has provided the following information to aid the decision.
Product A Product B Product C
Contribution Margin per package $12.00 $15.00 $7.50
Machine hours per package 2.5 4 1
Required: Which product should be eliminated to maximize profit?
a.Product A
b.Product B
c.Product C
d.It doesn't make any difference since they are contributing equally.
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