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Product Costing and Decision Making: Company P manufactures Product Alpha, which requires $30 of direct materials, $20 of direct labor, and $10 of variable overhead
·Product Costing and Decision Making: Company P manufactures Product Alpha, which requires $30 of direct materials, $20 of direct labor, and $10 of variable overhead per unit. Meanwhile, Company Q produces Product Beta, which requires $25 of direct materials, $25 of direct labor, and $15 of variable overhead per unit.
- Requirement 1: Determine the total product cost for each company's product.
- Requirement 2: Calculate the contribution margin per unit for both products.
- Requirement 3: Recommend which product each company should prioritize based on contribution margin.
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