Really need some help thanks in advance! In response to a growing awareness of g
ID: 2595135 • Letter: R
Question
Really need some help thanks in advance!
In response to a growing awareness of gluten allergies, Crane Bakery tried using gluten-free flour in its three most popular cookies. After several attempts and a lot of inedible cookies, the company perfected new recipes that yield delicious gluten-free cookies. The costs of producing a batch of 100 cookies are as follows Oatmeal Chocolate Chip Sales price Variable cost Fixed cost Total cost Gross profit Pounds of flour Sugar $111.80 $63 16 79.00 $32.80 $127.15 $85 20 105.00 $22.15 $129.00 $79 19 98.00 $31.00 Assuming no raw material constraints and unlimited demand for cookies, calculate contribution margin per batch or Chocolate Chip Sugar Oatmeal Raisin cookies 52.75. Round answers to 2 dec mal places, e - Cookies Contribution Margin Chip Sugar Oatmeal Raisin What type of cookie would maximize the company's contribution margin? LINK TO TEXT LINK TO VIDEO Assume that, based on typical customer demand, Crane will sell 13,100 batches of chocolate chip cookies, 9,100 batches of sugar cookies, and 11,100 batches of oatmeal raisin cookies. What will the company's contribution margin be? The company's contribution marginExplanation / Answer
Choco Chip Sugar Oatmeal Raisin Sales Price 129.00 111.80 127.15 Less: Variable Cost 79.00 63.00 85.00 Fixed Cost 19.00 16.00 20.00 Total Cost 98.00 79.00 105.00 Gross Pofit 31.00 32.80 22.15 Pounds of Flour 2.00 2.00 1.50 Q1 Choco Chip Sugar Oatmeal Raisin Sales Price 129.00 111.80 127.15 Less: Variable Cost 79.00 63.00 85.00 Contribution Margin 50.00 48.80 42.15 Highest Contribution is in Choco Chip; It will maximize the companies contribution margin Q2 Choco Chip Sugar Oatmeal Raisin Sales Price 129.00 111.80 127.15 Less: Variable Cost 79.00 63.00 85.00 Contribution Margin 50.00 48.80 42.15 No of Batch Sold 13100 9100 11100 Total Contribution Margin 655000 444080 467865 Total Contribution Margin 1566945 Q3 Total Available Flour 42850 Pounds Maxm Demand Batchs Choco Chip 13100 Sugar 9100 Oatmeal Raisin 11100 Choco Chip Sugar Oatmeal Raisin Sales Price 129.00 111.80 127.15 Less: Variable Cost 79.00 63.00 85.00 Contribution Margin 50.00 48.80 42.15 Pounds of Flour 2 2 1.5 Contribution Per Pound of Flour 25 24.4 28.1 Ranking II III I Use of Available Material to have optimul results: Product Pounds of Flour Contribution Per Pound of Flour Ranking Usage as per Ranking Choco Chip 2.00 25.00 II 26200 (13100*2.00) Sugar 2.00 24.40 III 0 No Material Left Oatmeal Raisin 1.50 28.10 I 16650 (11100*1.50) 42850 Total Contribution at optimul results: Product Batchs Contribution Per Batch Contribution Choco Chip 13100 50.00 655000 Sugar 0 48.80 0 Oatmeal Raisin 11100 42.15 467865 Total Contribution 1122865 If the same material is used in the products other than given above; then the decision will be based on ranking. We need to rank out again as per the above format
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