Pasadena Corporation produces three products, and currently has a shortage of machine hours since one of its two machines is down; only 450 hours are available this month. The selling prices, costs, and labor requirements of the three products are as follows: Sales price Variable cost per unit Machine hours per unit Required: Product A $ 10.25 Product B Product C $ 9.00 $ 5.00 1.75 $ 4.00 1.00 $ 2.50 $ 2.00 0.25 a. What is the contribution margin per unit for each product? b. What is the contribution margin per machine hour for each product? c. Assume Pasadena has unlimited demand for each product. Which product should Pasadena focus on producing? Complete this question by entering your answers in the tabs below. Required A Required B Required C What is the contribution margin per direct labor hour for each product? Note: Round your intermediate calculations to 2 decimal places. Contribution Margin per Machine Hour Product A Product B Product C < Required A Required C >
Pasadena Corporation produces three products, and currently has a shortage of machine hours since one of its two machines is down; only 450 hours are available this month. The selling prices, costs, and labor requirements of the three products are as follows: Sales price Variable cost per unit Machine hours per unit Required: Product A $ 10.25 Product B Product C $ 9.00 $ 5.00 1.75 $ 4.00 1.00 $ 2.50 $ 2.00 0.25 a. What is the contribution margin per unit for each product? b. What is the contribution margin per machine hour for each product? c. Assume Pasadena has unlimited demand for each product. Which product should Pasadena focus on producing? Complete this question by entering your answers in the tabs below. Required A Required B Required C What is the contribution margin per direct labor hour for each product? Note: Round your intermediate calculations to 2 decimal places. Contribution Margin per Machine Hour Product A Product B Product C < Required A Required C >
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter7: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 62P
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