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Manny Company produces three products, X, Y, and Z, with the following characteristics:
X Y Z
Selling price per unit $20 100% $16 100% $15 100%
Variable cost per unit 12 60 12 75 6 40
Contribution margin per unit $ 8 40% $ 4 25% $ 9 60%
Machine hours per unit 5 hours 3 hours 6 hours
The company has only 2,000 machine hours available each month. If demand exceeds the company's capacity, in what sequence should orders be filled if the company wants to maximize its total contribution margin? You must show work to support your answer.
The Adler Company manufactures a product with a unit variable cost of $50 and a unit sales price of $88. Fixed manufacturing costs were $240,000 when 10,000 units were produced and sold.
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