Business, 06.06.2020 23:57 des2962

Barlow Company manufactures three products: A, B, and C. The selling price, variable costs, and contribution margin for one unit of each product follow:Selling price A Product B C $240 $360 $320Variable expenses: Direct materials 24 72 32Other variable expenses 120 108 176Total variable expenses 144 180 208Contribution margin $96 $180 $112Contribution margin ratio 40% 50% 35%The same raw material is used in all three products. Barlow Company has only 4,400 pounds of raw material on hand and will not be able to obtain any more of it for several weeks due to a strike in its supplier’s plant. Management is trying to decide which product(s) to concentrate on next week in filling its backlog of orders. The material costs $8 per pound. Required:1. Compute the amount of contribution margin that will be obtained per pound of material used in each product. Contribution margin per unit $96 $180 $112Direct material cost per unit $24$ $72 $32Direct material cost per pound $8 $8 $8Pounds of material required per unit 3 4 9Contribution margin per pound 32 20 282A. Compute the amount of contribution margin on each product. A B C Contribution margin per pound 32 20 28Pounds of material available 4,400 4,400 4,400Total contribution margin $140,800 $88,000 $123,2002B. Which order would you recommend that the company work on next week—the orders for product A, product B, or product C?Product A Product B Product C3. A foreign supplier could furnish Barlow with additional stocks of the raw material at a substantial premium over the usual price. If there is unfilled demand for all three products, what is the highest price that Barlow Company should be willing to pay for an additional pound of materials?Maximum amount per pound

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Barlow Company manufactures three products: A, B, and C. The selling price, variable costs, and cont...

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