Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Benoit Company produces three products-A, B, and C. Data concerning the three products follow (per unit) Product Selling price Variable expenses: $80.00 66.00$72.00 16.50 12.00

image text in transcribed

Benoit Company produces three products-A, B, and C. Data concerning the three products follow (per unit) Product Selling price Variable expenses: $80.00 66.00$72.00 16.50 12.00 38.40 50.40 $32.00 $16.50 $21.60 24.00 24.00 48.00 Direct materials Other variable expenses Total variable expenses Contribution margin Contribution margin ratio 49.50 40% 25% 30% The company estimates that it can sell 700 units of each product per month. The same raw material is used in each product. The material costs $3 per pound with a maximum of 5,400 pounds available each month Required: 1. Calculate the contribution margin per pound of the constraining resource for each product. 2. Which orders would you advise the company to accept first, those for A, B, or C? Which orders second? Third? 3. What is the maximum contribution margin that the company can earn per month if it makes optimal use of its 5,400 pounds of materials

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Information Systems

Authors: Mario Piattini

1st Edition

1878289756, 9781878289759

More Books

Students also viewed these Accounting questions