Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity is 1,860 hours per year. Colt can sell up to 656 units of Hero and 848 units of Flip per year. Selling prices and variable costs follow. Selling price per unit Variable costs per unit Hero $ 156 52 Flip $ 98 56 (a) Compute the contribution margin per machine hour for each product. Hero Flip Contribution margin per unit Contribution margin per machine hour (b) Determine the best sales mix of products. Hero Flip Total Units produced and sold for most profitable sales mix Hours required to produce most profitable sales mix (c) Compute the total contribution margin for the best sales mix. Hero Flip Total Units produced for most profitable sales mix Contribution margin per unit Total contribution margin

Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity is 1,860 hours per year. Colt can sell up to 656 units of Hero and 848 units of Flip per year. Selling prices and variable costs follow. Selling price per unit Variable costs per unit Hero $ 156 52 Flip $ 98 56 (a) Compute the contribution margin per machine hour for each product. Hero Flip Contribution margin per unit Contribution margin per machine hour (b) Determine the best sales mix of products. Hero Flip Total Units produced and sold for most profitable sales mix Hours required to produce most profitable sales mix (c) Compute the total contribution margin for the best sales mix. Hero Flip Total Units produced for most profitable sales mix Contribution margin per unit Total contribution margin

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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