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Marginal Costing: Most efficient use of scarce resources A business makes 3 products, all which use the same material Z, which is currently in short
Marginal Costing: Most efficient use of scarce resources A business makes 3 products, all which use the same material Z, which is currently in short supply. Material Z is limited to 2000 kg per month (500 kg per week) Fixed costs 2000 Euro per month Products Pink Blue Green Selling price per unit () 60 80 75 Variable cost per unit () 25 35 45 Weekly demand (units) 100 150 250 Material Z need per unit (kg) 2 3 5 Required: Which combination of products should be manufactured if the business is to produce the highest profit
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