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

question 55

Multiple Choice

Manchester 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 G94T is $304.00 and its unit variable cost is $243.20. One unit of the product requires 16 ounces of the constrained resource. Monthly sales are 9,300 units. What is the profitability index for product G94T?

• A) $565,440
• B) 0.20
• C) $3.80 per ounce
• D) $19.00 per ounce

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Definitions:

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