Selling price Variable costs per unit: Direct materials Direct labor Variable overhead Total variable cost per unit Contribution margin per unit Multiple Choice $14.00 $20.00 $15.00 Product A Product B Product C $ 70 $ 75 $ 85 The company incurs total fixed costs of $50,000. The maximum demand for each of its products is 600 units. Its direct material cost is $8.00 per pound. The company has only 3,000 pounds of direct materials available for production. Assuming the company has made optimal use of its 3,000 pounds of direct material, what is the maximum amount per pound the company should be willing to pay for additional direct materials? $16.00 16 40 2 58 $ 12 24 28 2 54 $ 21 20 32 3 55 $ 30
Selling price Variable costs per unit: Direct materials Direct labor Variable overhead Total variable cost per unit Contribution margin per unit Multiple Choice $14.00 $20.00 $15.00 Product A Product B Product C $ 70 $ 75 $ 85 The company incurs total fixed costs of $50,000. The maximum demand for each of its products is 600 units. Its direct material cost is $8.00 per pound. The company has only 3,000 pounds of direct materials available for production. Assuming the company has made optimal use of its 3,000 pounds of direct material, what is the maximum amount per pound the company should be willing to pay for additional direct materials? $16.00 16 40 2 58 $ 12 24 28 2 54 $ 21 20 32 3 55 $ 30
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter7: Variable Costing For Management
analysis
Section: Chapter Questions
Problem 4BE
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