The management of Claypole Corporation has provided the following data concernin
ID: 2472282 • Letter: T
Question
The management of Claypole Corporation has provided the following data concerning its two products—H59 and C92: H59 C92
The management of Claypole Corporation has provided the following data concerning its two products—H59 and C92:
H59
C92
Selling price
$45.00
$60.00
Unit variable cost
$36.00
$54.00
Monthly demand (units)
1,430
2,680
The constrained resource is a particular machine that is available for 10,100 minutes each month. Each unit of product H59 requires 5 minutes on this machine. Each unit of product C92 requires 3 minutes on this machine.
What is the maximum contribution margin the company can earn per month?
$19,788
$18,770
$28,950
$19,249
H59
C92
Selling price
$45.00
$60.00
Unit variable cost
$36.00
$54.00
Monthly demand (units)
1,430
2,680
Explanation / Answer
A-$19788
Statement Showing Ranking for production
Time is limiting factor hence company will produce Product C62 full demand 2680 units because it gives contribution per minute more than H59.
Total Contribution =3708+16080 =$19788
H59 C62 Selling Price $45.00 $60.00 Unit Varriable Cost -$36.00 -$54.00 Contribution per unit $9.00 $6.00 Time Per Unit(minute) 5 3 Contribution per Minute $1.80 $2.00 Rank for production II IRelated Questions
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