Alberding Corporation would like to determine the relative profitability of the company's products for purposes of making volume trade-off decisions.For illustration,the company has provided the following data for product S06K: What is the profitability index for product S06K?
A)$6.00 per gram
B)$2.40 per gram
C)0.40
D)$367,200

Question

Alberding Corporation would like to determine the relative profitability of the company's products for purposes of making volume trade-off decisions.For illustration,the company has provided the following data for product S06K:  What is the profitability index for product S06K?
A)$6.00 per gram 
B)$2.40 per gram 
C)0.40 
D)$367,200

Quizplus · Accepted Answer

Profitability Index = Incremental profit F1F1F1S1F1F1F10 Amount of constrained resource required = $40.80* F1F1F1S1F1F1F10 17 grams = $2.40 per gram
$40.80 = $102.00 - $61.20

Alberding Corporation Would Like to Determine the Relative Profitability of the Company's