A company produces three products on the same plant. Fixed costs are applied to products based on the number of direct labour-hours required to make the product. The rate of application is based on...

A company produces three products on the same plant. Fixed costs are applied to products based on the number of direct labour-hours required to make the product. The rate of application is based on budgeted fixed costs of `60,00,000 and budgeted direct labour-hours of 1,00,000. Per unit data for the three products are as follows.

You are required to do the following:

1. Determine variable production costs per unit for each product.

2. Assuming that variable costs of production are the only variably costs, determine which product yields: (a) the highest contribution margin per unit, (b) the highest contribution margin percentage, and (c) the highest contribution margin per direct labour-hour.

3. If the firm asks you which product should be given more emphasis, what will be your answer?