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8 years ago
Pena Corporation manufactures two styles of lamps - a Bedford Lamp and a Lowell Lamp. The following per unit data are available:

   Bedford Lamp   Lowell Lamp
Sales price   $27   $35
Variable costs   $16   $22
Machine hours required for one lamp   2   6

Total fixed costs are $32,000, and Pena can sell a maximum of 10,000 units of each style of lamp annually. Machine hour capacity is 30,000 hours per year.  What is the contribution margin per machine hour for the Lowell Lamp? (Round your answer to the nearest cent.)
A) $2.17 per machine hour
B) $13.50 per machine hour
C) $17.50 per machine hour
D) $5.50 per machine hour
Textbook 
Horngren's Financial & Managerial Accounting, The Financial Chapters

Horngren's Financial & Managerial Accounting, The Financial Chapters


Edition: 5th
Authors:
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Deprecated Author
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#2
7 years ago
Makes perfect sense, thx
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