In making product mix decisions under constraining factors,which of the following is the key to choosing the product type to be maximized?

Question

Quizplus · Accepted Answer

In making product mix decisions under constraining factors, the key is to choose the product type that has the highest contribution margin per unit of the constraint. This means that for each unit of the constraint, the product that contributes the most towards covering the fixed costs and generating profit should be prioritized. Revenue per unit and gross profit per unit using traditional costing are less relevant in this context as they do not account for the limited availability of the constraint.

In Making Product Mix Decisions Under Constraining Factors,which of the Following