Product A has a contribution margin of $300 per unit and requires six hours of machine time Product B requires eight hours of machine time and provides $400 of contribution margin per unit Required If the capacity of machine time is limited to 1,200 hours and only one product can be produced, what ...

Product A Product B Contribution margin per unit 300 400 Machine hours required per un ...

Product A has a contribution margin of $300 per unit and requires six hours of machine time.

Question:

Product A has a of $300 per unit and requires six hours of machine time. Product B requires eight hours of machine time and provides $400 of per unit.
Required:
If the capacity of machine time is limited to 1,200 hours and only one product can be produced, what is the maximum amount of contribution that could he generated?
Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...