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Concept Introduction:
Contribution margin
Contribution margin is the difference between sales price of a product and variable cost that results in the incremental profit earned for each unit sold. It means the contribution margin generated to meet the fixed cost and generate profit.
Requirement 1:
We have to determine the contribution margin per machine hour that product generates.
Concept Introduction:
Contribution margin
Contribution margin is the difference between sales price of a product and variable cost that results in the incremental profit earned for each unit sold. It means the contribution margin generated to meet the fixed cost and generate profit.
Requirement 2:
We have to determine the product mix if it operates in only one shift and contribution margin of suh product mix.
Concept Introduction:
Contribution margin
Contribution margin is the difference between sales price of a product and variable cost that results in the incremental profit earned for each unit sold. It means the contribution margin generated to meet the fixed cost and generate profit.
Requirement 3:
We have to determine the product mix if it operates in two shifts and contribution margin of suh product mix.
Concept Introduction:
Contribution margin
Contribution margin is the difference between sales price of a product and variable cost that results in the incremental profit earned for each unit sold. It means the contribution margin generated to meet the fixed cost and generate profit.
Requirement 4:
We have to determine whether it is profitable to increase the maximum production of product G to 700 units.
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