Question

# An entity manufactures 4 products: A C E F CM/Unit \$20.28 \$30.47 \$26.20 \$36.91 Kg of...

An entity manufactures 4 products:

 A C E F CM/Unit \$20.28 \$30.47 \$26.20 \$36.91 Kg of Y used 1 6 10 2 KG of X used 3.00 4.00 8.71 7.51 Expected demand (units) 3907 1823 847 3988

Material X is very scarce and it is anticipated that only 24026 kg will be available next year. There is expected to be 200,000 kg of material Y available. What is the maximum contribution margin that can be achieved next year?

Select one:

a. \$149860

b. \$281978

c. \$159419

d. \$224935

 The Porter Company manufactures two products: A100 and A101. Each product uses skilled labour and the total hours of skilled labour available for the following year is limited to 9029 hours. Data for each of the two products is as follows: A100 A101 Contribution margin per unit \$36 \$48 Hours of skilled labour per unit 1 2 Maximum product demand (units) 5722 10365 What is the maximum contribution margin that can be achieved next year?

Select one:

a. \$325044

b. \$216696

c. \$285360

d. \$449424

1) Contribution margin per kg of X

 A C E F CM/Unit 20.28 30.47 26.20 36.91 Material X per unit 3 4 8.71 7.51 CM/Material X 6.76 7.6175 3.00 4.91 Rank 2 1 4 3

Optimum use :

 Kg Unit Product C 1823*4 = 7292 1823 Product A 3907*3 = 11721 3907 Proudct F (24026-19013) = 5013 5013/7.51 = 667.50 Units

Maximum contribution = (1823*30.47+3907*20.28+667.50*36.91) = 159419

2)

Contribution margin per hour

 A100 A101 Contribution margin 36 48 Hour per unit 1 2 Contribution margin per hour 36 24 Rank 1 2

Maximum contribution margin = 5722*36+ (9029-5722/2)*48 = 285360

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