Show Timer Quees Question 5 The Fabrication Company manufactures three products - D, E, and F. The selling price, variable costs, and contribution margin for one unit of each product follow: Product D E Selling price $240 $350 $500 Variable expenses: Direct materials 80 56 40 Other variable 40 expenses 182 360 Total variable expenses 120 238 400 Contribution margin $120 $112 $100 Contribution margin 50% ratio 32% 20% The same raw material is used in all three products. The company has only 8,000 kilograms of raw material on hand and will not be able to obtain any more of it for several weeks due to a strike at its supplier's plant. Management is trying to decide which product(s) to concentrate on next week in filling its backlog of orders. The material costs $8 per kilogram. Required: 1. Calculate the contribution margin per kilogram of the constraining resource for each product. (3 marks) 2. Assuming the company has unlimited demand for each of its three products, what is the maximum contribution margin the company can earn when using the 8,000 kilograms of raw material on hand? Explain. Show workings to support your answer. (3 marks) 3. Assuming the estimated customer demand is 500 units per product line, what is the maximum contribution margin the company can earn when using the 8,000 kilograms of raw material on hand? Show workings to support your answer. (4 marks) For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). BIUS Paragraph Open Sans, s... 10pt AV LY Ix E X2 X2 + ABC V V X BU AX MacBook Air 80