Question

Banfield Corporation makes three products that use compound W, the current constrained resource. Data concerning those products appear below:

VP YI WX
Selling price per unit
$248.04 $230.66 $505.44
Variable cost per unit
$190.71 $172.14 $388.80
Centiliters of compound W 3.90 3.80 8.10


Rank the products in order of their current profitability from most profitable to least profitable. In other words, rank the products in the order in which they should be emphasized.

Answer 1

Step-by-step explanation:

The products rank are shown below:

VP YI WX

Selling price per unit (A) $248.04 $230.66 $505.44

Variable cost per unit (B) $190.71 $172.14 $388.80

Contribution margin

per unit (A-B) or C $57.33 $58.52 $116.64

Centiliters of compound W (D) 3.90 3.80 8.10

Contribution per centiliters (C÷D) 14.7 15.4 14.4

Rank 2 1 3