ArchoChem Lid manufactures two chemicals, West1 and West2. Contribution margin data follow: West1 West2 Unit sales price $13.00 $31.00 Less Direct material 7.00 5.00 Direct
ArchoChem Lid manufactures two chemicals, West1 and West2. Contribution margin data follow: West1 West2 Unit sales price $13.00 $31.00 Less Direct material 7.00 5.00 Direct labour 1.00 6.00 Variable overhead 1.25 7.50 Variable selling and administrative costs 0.75 0.50 Unit contribution margin $ 3.00 $12.00 ArchoChem's production process uses highly skilled labour, which is in short supply. The same employees work on both products and earn the same wage rate of $21 per hour. Page 995 Required: Which of ArchoChem's products is the more profitable? Explain
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