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JSON-9722 Inc. produces Products X5, Y8, and Z9. The following table provides per unit information relating to the three products: Product X5 Y8 Z9 Selling

JSON-9722 Inc. produces Products X5, Y8, and Z9. The following table provides per unit information relating to the three products:

Product
X5 Y8 Z9
Selling price $ 88.00 $ 58.00 $ 80.00
Variable expenses:
Direct materials 26.40 12.00 12.00
Other variable expenses 26.40 34.40 44.00
Total variable expenses 52.80 46.40 56.00
Contribution margin $ 35.20 $ 11.60 $ 24.00
Contribution margin ratio 40% 20% 30%

JSON-9722 has enough demand to sell 800 units of each product per month. Each product requires the same direct materials in its production. The direct materials cost $3 per pound. The company will at most have 5,400 pounds of the direct materials available every month.

What is the maximum contribution margin that JSON-9722 can earn per month using its 5,400 pounds of direct materials optimally?

multiple choice

  • $ 8,800

  • $ 28,000

  • $ 30,500

  • $ 19,200

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