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Benoit Company produces three products, A, B, and C. Data concerning the three products follow (per unit): Product B $ 95 Selling price 115 $
Benoit Company produces three products, A, B, and C. Data concerning the three products follow (per unit): Product B $ 95 Selling price 115 $ $ 105 28.50 7.35 Variable expenses: Direct materials Other variable expenses 34.50 34.50 42.75 66.15 Total variable expenses 69.00 71.25 73.50 Contribution margin $46.00 $ 23.75 $31.50 Contribution margin ratio 40% 25% 30% Demand for the company's products is very strong, with far more orders each month than the company can produce with the available raw materials. The same material is used in each product. The material costs $4 per pound with a maximum of 5,000 pounds available each month. Required: a. Compute contribution margin per pound of materials used. (Round your intermediate calculations and final answers to 2 decimal places.) Contribution Margin per Pound Product A Product B Product b. Which orders would you advise the company to accept first, those for A, for B, or for C? Which orders second? Third? Product A Product B Product C
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