24(09)-6B_9e - This would be determined as follows: Revised...

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Problem 24(09)-6B Name: Section: Enter the appropriate amount in the shaded cells below. A red asterisk (*) will appear to the right of an incorrect amount in the outlined cells. 1. Ethylene Butane Ester Selling price Variable conversion cost per unit Direct materials cost per unit Total cost per unit Contribution margin per unit 2. Ethylene Butane Ester Contribution margin per unit Reactor (bottleneck) hours per unit ÷ Contribution margin per reactor hour 3. Revised price of Ethylene: - = Reactor hours of Ethylene per unit - = = Revised price of Ethylene One way to revise the pricing would be to increase the price to the point where all three products produce profitability equal to the highest profit product.
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Unformatted text preview: This would be determined as follows: Revised price of Ethylene Variable cost per unit of Ethlylene Contribution margin per reactor hour for Butane Revised price of Ethylene (Price required of Ethylene to deliver the same contribution margin per bottleneck hour as does Butane) Revised price of Ester: Revised price of Ester-= Reactor hours of Ester per unit-= = Revised price of Ester (Price required of Ester to deliver the same contribution margin per bottleneck hour as does Butane) Variable cost per unit of Ester Contribution margin per reactor hour for Butane Revised price of Ethylene...
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This note was uploaded on 10/22/2010 for the course BUSINESS BAIU09 taught by Professor Mr.ken during the Spring '10 term at American InterContinental University Dunwoody.

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24(09)-6B_9e - This would be determined as follows: Revised...

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