Underwood, Inc. manufactures two products. It currently has 5,600 hours of direct labor and 800 hours of machine time available per month. The table below lists the contribution margin, labor and machine time requirements, and demand for each product. Product A Product B Unit contribution margin $18.00 $15.00 Demand 2,600 units 1, 300 units Labor time 1/5 hour 1/4 hour Machine time 2 hour 1/4 hour What is the contribution margin per machine hour for Product B?
Underwood, Inc. manufactures two products. It currently has 5,600 hours of direct labor and 800 hours of machine time available per month. The table below lists the contribution margin, labor and machine time requirements, and demand for each product. Product A Product B Unit contribution margin $18.00 $15.00 Demand 2,600 units 1, 300 units Labor time 1/5 hour 1/4 hour Machine time 2 hour 1/4 hour What is the contribution margin per machine hour for Product B?
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 1EA: Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor...
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See question in picture . Multiple choice options as follows :
A. $4.00
B.$15.00
C. $18.00
D.$60.00
Transcribed Image Text:Underwood, Inc. manufactures two products, It currently has 5,600 hours of direct labor and 800 hours of machine time available
per month. The table below lists the contribution margin, labor and machine time requirements, and demand for each product.
Product A
Product B
Unit contribution margin
$18.00
$15.00
Demand
2,600 units 1,300 units
Labor time
1/5 hour
1/4 hour
Machine time
2 hour
1/4 hour
What is the contribution margin per machine hour for Product B?
Multiple Choice
$4.00
$15.00
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