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6 years ago
Ralph's Mufflers manufactures three different product lines, Model X, Model Y, and Model Z. Considerable market demand exists for all models. The following per unit data apply:
   Model X   Model Y   Model Z
Selling price   $160   $180   $200
Direct materials   60   60   60
Direct labour ($20 per hour)   30   30   40
Variable support costs ($10 per machine-hour)   10   20   20
Fixed support costs   40   40   40

a.   For each model, compute the contribution margin per unit.
b.   For each model, compute the contribution margin per machine-hour.
c.   If there is excess capacity, which model is the most profitable to produce? Why?
d.   If there is constrained capacity, which model is the most profitable to produce? Why?
e.   How can Ralph encourage her sales people to promote the more profitable model?
Textbook 
Cost Accounting: A Managerial Emphasis, Canadian Edition

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
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ruskin Author
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6 years ago
You make an excellent tutor!
Transonic
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I appreciate what you did here, answered it right Smiling Face with Open Mouth
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2 hours ago
this is exactly what I needed
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