Efford Corporation Would Like to Determine the Relative Profitability of the Company's

question 32

Multiple Choice

Efford Corporation would like to determine the relative profitability of the company's products for purposes of making volume trade-off decisions.For example,the selling price of product I14H is $36.00,its unit variable cost is $28.80,and its unit contribution margin is $7.20.One unit of the product requires 6 minutes of the constrained resource.Monthly sales are 1,700 units.What is the profitability index for product I14H?

• A)$1.20 per minute
• B)$6.00 per minute
• C)0.20
• D)$12,240

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