Required information The Foundational 15 (Algo) (LO11-2, LO11-3, LO11-4, LO11-5, LO11-6) The following information applies to the questions displayed below.) Cane Company manufactures two products called Alpha and Beta that sell for $170 and $130, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 116,000 units of each product. Its average cost per unit for each product at this level of activity are given below. Direct materials Direct labor Variable manufacturing over head Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 30 30 20 26 22 25 $ 153 Beta $ 18 25 15 28 18 20 $ 124 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Foundational 11-15 (Algo) 15. Assume that Cane's customers would buy a maximum of 90,000 units of Alpha and 70,000 units of Beta. Also assume that the company's raw material available for production is limited to 221,000 pounds. If Cane uses its 221,000 pounds of raw materials, up to how much should it be willing to pay per pound for additional raw materials? (Round your answer to 2 decimal places.) Maximum price to be paid per pound Required information The Foundational 15 (Algo) (LO11-2, LO11-3, LO11-4, LO11-5, LO11-6) The following information applies to the questions displayed below.) Cane Company manufactures two products called Alpha and Beta that sell for $170 and $130, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 116,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Alpha $ 30 30 20 26 Beta $ 18 25 Direct materials Direct labor Variable manufacturing overhead Tzaceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit 28 20 $ 124 $ 153 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Foundational 11-14 (Algo) 14. Assume that Cone's customers would buy a maximum of 90,000 units of Alpha and 70,000 units of Beta. Also assume that the material available for production is limited to 221000 pounds. What is the total contribution margin Cane Company will earn? Total contribution margin Required information The Foundational 15 (Algo) (L011-2, LO11-3, LO11-4, LO11-5, LO11-6) (The following information applies to the questions displayed below.) Cane Company manufactures two products called Alpha and Beta that sell for $170 and $130, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 116,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 30 30 20 26 22 25 $ 153 Beta $ 18 25 15 28 18 20 $ 124 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Foundational 11-13 (Algo) 13. Assume that Cane's customers would buy a maximum of 90,000 units of Alpha and 70,000 units of Beta. Also assume that the raw material available for production is limited to 221,000 pounds. How many units of each product should Cane produce to maximize its profits? Alpha Beta Units produced
