POR company manufactures three finished goods: X, Y, and Z. The selling price, variable costs, and contribution margin for one unit of each product are given in the following table: Finished Good X Y 7 Selling price $360 $540 $480 Variable costs: Direct material $48 $144 $64 Direct labour $40 $50 $60 Other variable costs $164 $130 $236 Total Variable costs $252 $324 $360 Contribution Margin $108 $216 $120 Contribution margin ratio 30% 40% 25% The same raw materials are used in all three products. POR company has only 5,000 kilograms of raw materials on hand and will not be able to obtain more of it for several weeks due to the recent outbreak of COVID 19 in its supplier's plant. The production manager has approached the management accountant for help in deciding which product(s) to concentrate on when filling its backlog orders. The raw materials cost $8 per kilogram. Required: a) Compute each product's contribution margin per Kilogram of raw material? (5 marks) b) Which of the orders for X, Y and Z would you recommend that POR company work on next week? Justify your answer with your computations? (5 marks) c) A supplier from a foreign country is available to provide the additional raw materials at a premium price. If there is unfilled demand for all three products, what is the highest price per kilogram that POR company should be willing to pay for additional raw materials? Explain your answer. (10 marks) (Chapter 10, 20 marks)|