C. ($7) D. ($41) QUESTION 15 Herbert Corporation makes three products that use c

Question

C. ($7) D. ($41) QUESTION 15 Herbert Corporation makes three products that use compound W, the current constrained resources. Data concerning those products appear below RC UT DQ 122.25 $162.36$65.66 2.503.60 Variable cost per unit Centiliters of compound W 2.50 1.40 Rank the products in order of their current proftablity from most proftable to least proftable in other word-rank the products in the order in which they should be emphasized G A. UT, RC, DQ B. DQ. RC, UT B C RC, DQ, UT D.UT. DQ. RC F. RC,UT, DO

Explanation / Answer

RC UT DQ Selling price per unit $     150.25 $    225.36 $     84.84 Variable cost per unit $     122.25 $    162.36 $     65.66 Contribution margin per unit $       28.00 $       63.00 $     19.18 Centiliters of compound W 2.50 3.60 1.40 Contribution margin per centiliter of Compound W $       11.20 $       17.50 $     13.70 Profitability in terms of the Contribution Margin per unit of the constrained resource is the criteria. It is highest of UT and lowest fo RC. Hence, ranking is Option: [D] UT:DQ:RC

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