The company considers its traceable fixed manufacturing

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Reference no: EM13588619

Cane Company manufactures two products called Alpha and Beta that sell for $120 and $80, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 100,000 units of each product. Its unit costs for each product at this level of activity are given below:

	Alpha			Beta
Direct materials		$	30		$	12
Direct labor			20			15
Variable manufacturing overhead			7			5
Traceable fixed manufacturing overhead			16			18
Variable selling expenses			12			8
Common fixed expenses			15			10

Total cost per unit		$	100		$	68

The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars.

Required:

How many pounds of raw material are needed to make one unit of Alpha and one unit of Beta?

	Alpha	Beta
Pounds of raw materials per unit

Reference no: EM13588619

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