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
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 B $100.00 $99.00 $110.00 Selling price Variable costs: Direct materials Direct Labour Variable manufacturing overhead Total variable cost Contribution margin Contribution sargin ratio 44.40 18.00 6.00 68.40 $21.60 15.00 30.00 10.00 55.00 $45.00 45 64.30 12.00 4.00 80.30 $29.70 275 249 Due to a strike in the plant of one of its competitors, demand for the company's products for 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 $6 per hour, and only 3,430 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 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 Contribution margin per labour hour 2. Which orders would you recommend that the company work on next week-the orders for product A, product B, or product C? Product C Product A Product B 3. By paying overtime wages, more than 3,430 hours of direct labour time can be made available next week. Up to how much should the company be willing to pay per hour in overtime wages as long as there is unfilled demand for the three products? (Do not round Intermediate calculations. Round your answer to 2 decimal places.) mum amount per 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 Cost Accounting A Managerial Emphasis

Authors: Srikant Datar, Madhav Rajan

16th Global Edition

1292211547, 9781292211541

More Books

Students also viewed these Accounting questions

Question

=+3. In what way is this case about creativity and innovation?

Answered: 1 week ago