In response to a growing awareness of gluten allergies, Blossom Bakery tried using gluten-free flour in its three most popular cookies. After several attempts and a lot of inedible cookies, the company perfected new recipes that yield delicious gluten-free cookies. The costs of producing a batch of 100 cookies are as follows:

Chocolate Chip Sugar Oatmeal Raisin

Sales price

$118 $110 $115

Variable cost

$68 $72 $68

Fixed cost

16 15 20

Total cost

84 87 88

Gross profit

$34 $23 $27

Pounds of flour

2.5 2.5 2

A.) Cookies Contribution Margin

Chocolate Chip $enter a dollar amount rounded to 2 decimal places

Sugar $enter a dollar amount rounded to 2 decimal places

Oatmeal Raisin $enter a dollar amount rounded to 2 decimal places

What type of cookie would maximize the companys contribution margin? _________________

B.) Assume that, based on typical customer demand, Blossom will sell 10,800 batches of chocolate chip cookies, 6,800 batches of sugar cookies, and 8,800 batches of oatmeal raisin cookies. What will the companys contribution margin be?

enter the companys contribution margin in dollars

C.) Blossoms flour supplier has announced a shortage of gluten-free flour. As a result, Blossom will only be able to purchase 44,600pounds of flour. How many batches of each type of cookie should the company bake?

Chocolate Chip		enter a number of batches
Sugar		enter a number of batches
Oatmeal Raisin		enter a number of batches

What will the companys contribution margin be?

enter the companys contribution margin in dollars

D.) If Blossom uses gluten-free flour in other products, will the allocation you recommend in part (c) change? Y/N