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In response to a growing awareness of gluten allergies, Sandhill Bakery tried using gluten-free flour in its three most popular cookies. After several attempts
In response to a growing awareness of gluten allergies, Sandhill 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 $135 $130 $135 Variable cost $79 $77 $80 Fixed cost 16 15 19 Total cost 95 92 99 Gross profit $40 $38 $36 Pounds of flour 2.5 25 2.5 2 (a) Assuming no raw material constraints and unlimited demand for cookies, calculate contribution margin per batch for Chocolate Chip, Sugar, Oatmeal Raisin cookies. (Round answers to 2 decimal places, e.g. 52.75.) Cookies Contribution Margin Chocolate Chip Sugar Oatmeal Raisin What type of cookie would maximize the company's contribution margin?
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