What contribution margin per pound of raw material is earned by Alpha and Beta?

Assume that Canes customers would buy a maximum of 95,000 units of Alpha and 75,000 units of Beta. Also assume that the companys raw material available for production is limited to 245,000 pounds. How many units of each product should Cane produce to maximize its profits?

Assume that Canes customers would buy a maximum of 95,000 units of Alpha and 75,000 units of Beta. Also assume that the companys raw material available for production is limited to 245,000 pounds. What is the maximum contribution margin Cane Company can earn given the limited quantity of raw materials?

[The following information applies to the questions displayed below. Cane Company manufactures two products called Alpha and Beta that sell for $195 and $150, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 123,000 units of each product. Its unit costs for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable foxed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 40 34 22 30 27 30 $ 183 Beta $ 15 28 20 33 23 25 $ 144 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars