Gordy, Inc. produces three products. Data concerning the selling prices and unit
ID: 2458478 • Letter: G
Question
Gordy, Inc. produces three products. Data concerning the selling prices and unit costs of the three products appear below:
Product
Fixed costs are applied to the products on the basis of direct labor hours. Demand for the three products exceeds the company's productive capacity. The grinding machine is the constraint, with only 2,700 minutes of grinding machine time available this week.
Calculate the contribution margin per minute for all three products. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)
Given the grinding machine constraint, which product should be emphasized?
Gordy, Inc. produces three products. Data concerning the selling prices and unit costs of the three products appear below:
Explanation / Answer
a-1)
a-2)
Product L
Note : Product L is having highest Contribution margin per minute among all other product
J K L Selling price [a] 70.00 50.00 80.00 Variable costs [b] 45.00 35.00 50.00 Contribution margin per unit [c = a-b] 25.00 15.00 30.00 Granding machine time (minutes) [d] 10.00 5.00 5.00 Contribution margin per minute [e = c/d] 2.50 3.00 6.00Related Questions
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