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kumpel [21]
2 years ago
15

Material is a scarce resource. The product uses four pounds of material. How much would the company be willing to pay for one mo

re pound of material
Business
1 answer:
miss Akunina [59]2 years ago
7 0

The amount that the company is willing to pay is $12.50.

<h3>What is CM per pounds?</h3>

CM per pounds means the Contribution margin per pounds that we will calculate below.

Particulars                     Amount

Selling price                   $125  

Less: Variable cost

Material                           $40  

Labor                   $22.5  

Variable cost                  <u>$12.5</u>  

CM per unit                     $50  

Divide: Pounds used       <u>$4</u>  

CM per pound          <u>$12.5</u>

In conclusion, the amount that the company is willing to pay is $12.50.

Read more about Contribution margin

<em>brainly.com/question/15684424</em>

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Complete Question:

BrainTrust company produces and sells educational toys for children. In pricing its product, the company needs to make sure it properly estimates its costs. The company can safely estimate that transportation is what percentage of total distribution cost?

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In this scenario, BrainTrust Company produces and sells educational toys for children. In pricing its product, the company needs to make sure it properly estimates its costs. The company can safely estimate that transportation is 50% of total distribution cost.

In supply chain management, the total distribution cost can be defined as the overall expenses incurred by a manufacturer in the process of delivering finished goods and services from the production stage to the final consumer. The total distribution cost can either be direct or indirect expenses incurred on insurance, handling, storage, shipping, packing and logistics.

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