1 answer

The Gentry Corporation produces three products with the following costs and selling prices: Product A Product...

Question:

The Gentry Corporation produces three products with the following costs and selling prices: Product A Product B Product C Sel

The Gentry Corporation produces three products with the following costs and selling prices: Product A Product B Product C Selling price per unit $10 $12 $18 Variable cost per unit $5 $11 Direct labor hours per unit 2.0 2.5 Machine hours per unit 3.5 2.0 2.5 If Gentry has a limit of 9,000 direct labor hours but no limit on machine hours, then the ranking of the products from the most profitable to the least profitable use of the constrained resource is: 1.0 OB,C,A O A,C,B A,B,C OC, A, B

Answers

Contribution margin per direct labor hour

Product A = (10-5)/2 = 2.50

Product B = (12-8)/1 = 4

Product C = (18-11)/2.5 = 2.80.

B,C,A

OPTION A is the answer

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