Benolt Company produces three productsA B and C Data concerning the three products follow per unit:
tableProduct,,,ABCSelling price,$$$Variable expenses:,Direct materials,Other variable expenses,Total variable expenses,$$$Contribution margin,
The company estimates that it can sell units of each product per month. The same raw materlal is used in each product. The material costs $ per pound with a maximum of pounds avallable each month.
Required:
Calculate the contribution margin per pound of the constraining resource for each product.
Which orders would you advise the company to accept first, those for A B or C Which orders second? Third?
What is the maximum contribution margin that the company can earn per month if it makes optimal use of its pounds of materlals?
