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ABC Company produces Product A and Product B. Product A's Contribution margin = $300 per unit; Machining time = 5 hours per unit. Product
ABC Company produces Product A and Product B. Product A's Contribution margin = $300 per unit; Machining time = 5 hours per unit. Product B's Contribution margin = $400 per unit; Machining time = 8 hours per unit. The capacity of machine time is limited to 1,200 hours and only one product can be produced. Calculate the contribution margin per machine hour for each product: Product A contribution margin = $ Product B contribution margin = $ per machine hour per machine hour Decision Use 1,200 machine hours to produce (Product A/Product B)
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