For this problem step 1 is the calculation of the contribution for each product which is 51 and 40 respectively. It is given that Alpha needs 5 pounds of materials and Beta requires 2 pounds of raw material per unit. 51/5 and 40/2 will give you the contribution margin per pound of raw materials that is earned for the two products. This gives me a answer of 10.20 and 20.00 respectively. However I don't understand this solution because this would be inferring that there are no other costs are involved in producing the product. For instance 10.20* 5 =51, 51 is the whole contribution margin, other costs are involved in this 51 (direct labor, variable expenses, etc). Therefore how could 10.20 be the contribution margin per pound for Alpha?

Required information The Foundational 15 (LO11-2, LO11-3, LO11-4, LO11-5, LO11-6] The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $120 and $80, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 100,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Alpha $ 30 Beta $12 Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit $100 $ 68 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Foundational 11-12 12. What contribution margin per pound of raw material is earned by each of the two products? (Round your answers to 2 decimal places.) Alpha Beta Contribution margin per pound