When multiple products share a constrained resource, the constrained resource should be allocated first to the product with
A)the lowest contribution margin.
B)the lowest contribution margin per unit.
C)the highest contribution margin per constrained resource.
D)the highest contribution margin.

Question

Quizplus · Accepted Answer

Allocating the constrained resource to the product with the highest contribution margin per constrained resource ensures that the resource is being used in the most efficient and profitable way possible. This metric takes into account both the contribution margin and the consumption of the constrained resource, providing the best overall measure of profitability for each product.

When Multiple Products Share a Constrained Resource, the Constrained Resource