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12. What contribution margin per pound of raw material is earned by each of the two products? Note: Round your answers to 2 decimal places. 13. Assume Cane's customers would buy a maximum of 81,000 units of Alpha and 61,000 units of Beta. Also assume the raw material available for production is limited to 161,000 pounds. How many units of each product should Cane produce to maximize its profits? 9. Assume Cane expects to produce and sell 81,000 Alphas during the current year. A supplier offered to manufacture and deliver 81,000 Alphas to Cane for a price of $84 per unit. What is the financial advantage (disadvantage) of buying 81,000 units from the supplier instead of making those units? 11. How many pounds of raw material are needed to make one unit of each of the two products? Martin Company uses the absorption costing approach to cost-plus pricing, It is considering the introduction of a new product. To determine a selling price, the company gathered the following information: Required: 1. Compute the markup percentage on absorption cost required to achieve the desired ROI. 2. Compute the selling price per unit. Note: Do not round intermediate calculations. Round your answer to 2 decimal places. 10. Assume Cane expects to produce and sell 51,000 Alphas during the current year. A supplier offered to manufacture and deliver 51,000 Alphas to Cane for a price of $84 per unit. What is the financial advantage (disadvantage) of buying 51,000 units from the supplier instead of making those units? Shimada Products Corporation of Japan plans to introduce a new electronic component to the market at a target selling price of $15 per unit. The company is investing $11,560,000 to purchase the equipment it needs to produce and sell 408,000 units per year. Its required rate of return on all investments is 12%. Required: Compute the component's target cost per unit. Note: Round your answer to 2 decimal places. 15. Assume Cane's customers would buy a maximum of 81,000 units of Alpha and 61,000 units of Beta. Also assume the company's raw material available for production is limited to 161,000 pounds. If Cane uses its 161,000 pounds of raw materials, up to how much should it be willing to pay pet pound for additional raw materials? Note: Round your answer to 2 decimal places. Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000 units of each product. Its average cost per unit for each product at this level of activity is given below: The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars
