prioritization of products with constrained resources 404199

Barclay manufactures three types of stained glass window, cleverly named Products A, B, and C. Information about these products follows:

Product A

Product B

Product C

Sales price

$

35

$

45

$

75

Variable costs per unit

17

21

32

Fixed costs per unit

5

5

5

Required number of labor hours

0.5

0.8

1.25

Barclay currently is limited to 16,000 labor hours per month.

Requirement 1:

Determine contribution margin per direct labor hour.(Round your answers to 2 decimal place. Omit the “$” sign in your response.)

Contribution Margin per Direct Labor Hour:

Product A

$

CM per DL hour

Product B

$

CM per DL hour

Product C

$

CM per DL hour

Requirement 2:

Which company has the highest contribution margin per direct labor hour?