A Level Accounting (9706)•9706/13/M/J/20

Explanation
Rank products by contribution per labor hour under labor constraint
Steps:
- Identify limiting factor: labor shortage requires maximizing contribution per labor hour.
- Note Z has no labor hours listed, so it uses zero labor and ranks first (unlimited production possible without consuming resource).
- For X and Y, compute contribution per labor hour: X = 150 / 1.25 = 120; Y = 175 / 0.75 ≈ 233.
- Rank: Z (infinite per hour), then Y (233), then X (120).
Why C is correct:
- C (Z Y X) follows limiting factor rule: prioritize non-users of scarce resource first, then highest contribution per unit of resource.
Why the others are wrong:
- A: Starts with X, which has lowest contribution per labor hour.
- B: Starts with Y, ignoring Z's zero labor use.
- D: Places X before Y, reversing their contribution per labor hour order.
Final answer: C
Topic: Traditional costing methods
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