Check my work 4 Exercise 11-8 Volume Trade-Off Decisions (LO11-5, LO11-6] 1 points Skipped eBook Barlow Company manufactures three products-A, B and C. The selling price, variable costs, and contribution margin for one unit of each product follow Product B Selling price $160 $270 $240 Variable expenses: Direct materials 16 80 32 Other variable 108 expenses 90 148 Total variable expenses 124 178 180 Contribution margin $ 36 $100 $ 60 Contribution margin ratio 23 37% 25% Hint Files Print The same raw material is used in all three products. Barlow Company has only 6,000 pounds of raw material on hand and will not 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 products) to concentrate on next week in filling is backlog of orders. The material costs $8 per pound. Reference 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? 4. A foreign supplier could furnish Barlow with additional stocks of the raw material at a substantial premium over the usual price. Assuming Barlow's estimated customer demand is 500 units per product line and that the company has used its 6,000 pounds of raw material in an optimal fashion, what is the highest price Barlow Company should be Willing to pay for an additional pound of materials? Complete this question by entering your answers in the tabs below. Required Required Required Required 1 2 3 Calculate the contribution margin per pound of the constraining resource for each product. B Contribution margin per pound of the constrained resource C the company used its 6,000 pounds of raw material in an optimal fashion, what is the highest price Barlow Company should b willing to pay for an additional pound of materials? Complete this question by entering your answers in the tabs below. Required Required Required Required 3 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? Show less Maximum contribution margin pay for an additional pound of materials? What is the highest price Barlow Company should be Complete this question by entering your answers in the tabs below. Required Required Refaired Required 2 4 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? Maximum contribution margin Show less Complete this question by entering your answers in the tabs below. Required Required Required Rectaired 2 3 A foreign supplier could furnish Barlow with additional stocks of the raw material at a substantial premium over the usual price. Assuming Barlow's estimated customer demand is 500 units per product line and that the company has used its 6,000 pounds of raw material in an optimal fashion, what is the highest price Barlow Company should be willing to pay for an additional pound of materials? Show less Highest price willing to pay per pound
