FRANCORP sells two products. Products M N Selling price per unit $80 $60 Less variable expenses per unit $46 $40 Contribution margin per unit $34 $20 Current demand per week (units) 2,100 2,400...

FRANCORP sells two products.

      Products

     M                 N

Selling price per unit                                              $80             $60

Less variable expenses per unit                            $46             $40

Contribution margin per unit                                  $34             $20

Current demand per week (units)                          2,100          2,400

Processing time required on machine XYZ per unit    2 min. 1 min.

1. Machine XYZ is a constrained resource and is being used at 100% capacity.


2. Machine XYZ has a capacity of 3,000 minutes per week.

Which product should FRANCORP focus on?

a. Product N since it provides a contribution margin net benefit of $3 per minute

b. Product N since it provides a contribution margin net benefit of $3.50 per minute

c. Product M since it provides a contribution margin net benefit of $2.20 per minute

d. Product M since it provides less contribution margin per minute