Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following are the selling price, variable costs, and contribution margin for one unit of each of Banner Company's three products: A, B, and C:

image text in transcribed
The following are the selling price, variable costs, and contribution margin for one unit of each of Banner Company's three products: A, B, and C: Product A B C Selling price $70.00 $130.00 $180.00 Variable costs: Direct materials 30.50 51.00 114.00 Direct labour 12.00 32.00 24.00 Variable manufacturing overhead 3.00 8.00 6.00 Total variable cost 45. 50 91.00 144.00 Contribution margin $24.50 $ 39.00 $ 36.00 Contribution margin ratio 35% 30% 20% Due to a strike in the plant of one of its competitors, demand for the company's products far exceeds its capacity to produce. Management is trying to determine which product(s) to concentrate on next week in filling its backlog of orders. The direct labour rate is $8 per hour, and only 3,850 hours of labour time are available each week. Required: 1. Compute the amount of contribution margin that will be obtained per hour of labour time spent on each product. (Round your intermediate calculations to 1 decimal place. Round your answers to 2 decimal places.) A B C Contribution margin per labour hour

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Horngrens Accounting The Financial Chapters

Authors: Tracie L. Miller Nobles, Brenda L. Mattison, Ella Mae Matsumura

10th Edition

0133117561, 978-0133117561

More Books

Students also viewed these Accounting questions

Question

How is the atomic weight (mass number) of an atom determined?

Answered: 1 week ago

Question

C Corporation tax computations and calculation of loss limitations

Answered: 1 week ago

Question

3. Avoid making mistakes when reaching our goals

Answered: 1 week ago