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es Required Information [The following information applies to the questions displayed below] Cane Company manufactures two products called Alpha and Beta that sell for $180 and $145, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 118,000 units of each product. Its average cost per unit for each product at this level of activity is given below. Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $ 36 $ 24 32 27 19 17 27 30 24 20 27 22 $ 165 $ 140 The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars 15. Assume Cane's customers would buy a maximum of 92,000 units of Alpha and 72.000 units of Beta. Also assume the company's raw material available for production is limited to 300.000 pounds. If Cane uses its 300,000 pounds of raw materials, up to how much should it be willing to pay per pound for additional raw materials? Note: Round your answer to 2 decimal places. Maximum price to be paid per pound

es Required Information [The following information applies to the questions displayed below] Cane Company manufactures two products called Alpha and Beta that sell for $180 and $145, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 118,000 units of each product. Its average cost per unit for each product at this level of activity is given below. Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $ 36 $ 24 32 27 19 17 27 30 24 20 27 22 $ 165 $ 140 The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars 15. Assume Cane's customers would buy a maximum of 92,000 units of Alpha and 72.000 units of Beta. Also assume the company's raw material available for production is limited to 300.000 pounds. If Cane uses its 300,000 pounds of raw materials, up to how much should it be willing to pay per pound for additional raw materials? Note: Round your answer to 2 decimal places. Maximum price to be paid per pound

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 4EB: Roper Furniture manufactures office furniture and tracks cost data across their process. The...
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es Required Information [The following information applies to the questions displayed below] Cane Company manufactures two products called Alpha and Beta that sell for $180 and $145, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 118,000 units of each product. Its average cost per unit for each product at this level of activity is given below. Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $ 36 $ 24 32 27 19 17 27 30 24 20 27 22 $ 165 $ 140 The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars 15. Assume Cane's customers would buy a maximum of 92,000 units of Alpha and 72.000 units of Beta. Also assume the company's raw material available for production is limited to 300.000 pounds. If Cane uses its 300,000 pounds of raw materials, up to how much should it be willing to pay per pound for additional raw materials? Note: Round your answer to 2 decimal places. Maximum price to be paid per pound
Transcribed Image Text:es Required Information [The following information applies to the questions displayed below] Cane Company manufactures two products called Alpha and Beta that sell for $180 and $145, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 118,000 units of each product. Its average cost per unit for each product at this level of activity is given below. Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $ 36 $ 24 32 27 19 17 27 30 24 20 27 22 $ 165 $ 140 The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars 15. Assume Cane's customers would buy a maximum of 92,000 units of Alpha and 72.000 units of Beta. Also assume the company's raw material available for production is limited to 300.000 pounds. If Cane uses its 300,000 pounds of raw materials, up to how much should it be willing to pay per pound for additional raw materials? Note: Round your answer to 2 decimal places. Maximum price to be paid per pound
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