Shelby Company produces three products: product X, product Y, and product Z. Data
concerning the three products follow (per unit):
Demand for the company%u2019s products is very strong, with far more orders each month
than the company can produce with the available raw materials. The same material is used in
each product. The material costs $4 per pound, with a maximum of 4,400 pounds available each
month.
Compute contribution margin per pound of materials used. (Round your intermediate
calculations and final answers to 2 decimal places.)
Shelby Company produces three products: product X, product Y, and product Z. Data
concerning the three products follow (per unit):
Solution
Cost per pound
Direct material pounds per unit
Contribution margin per pound
XYZDirect Material Cost28.522.55.95
Cost per pound444
Direct material pounds per unit28.5/4
=7.12522.5/4
=5.6255.95/4
=1.4875Contribution margin3818.7525.5
Contribution margin per pound38/7.125
=5.3318.75/5.625
=3.3325.5/1.4875
concerning the three products follow (per unit):
Demand for the company%u2019s products is very strong, with far more orders each month
than the company can produce with the available raw materials. The same material is used in
each product. The material costs $4 per pound, with a maximum of 4,400 pounds available each
month.
Compute contribution margin per pound of materials used. (Round your intermediate
calculations and final answers to 2 decimal places.)
Shelby Company produces three products: product X, product Y, and product Z. Data
concerning the three products follow (per unit):
Solution
Cost per pound
Direct material pounds per unit
Contribution margin per pound
XYZDirect Material Cost28.522.55.95
Cost per pound444
Direct material pounds per unit28.5/4
=7.12522.5/4
=5.6255.95/4
=1.4875Contribution margin3818.7525.5
Contribution margin per pound38/7.125
=5.3318.75/5.625
=3.3325.5/1.4875
