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Assume that a car manufacturer produces only four types cars: Model X, Model y, Roadster, and Speedster. A limitation of 1,580 microprocessors per week prevents

Assume that a car manufacturer produces only four types cars: Model X, Model y, Roadster, and Speedster. A limitation of 1,580 microprocessors per week prevents the manufacturer from meeting sales demand for these cars. The product information is presented below:

Model X Model Y Roadster Speedster
Unit Selling Price 35,750 43,500 65,000 89,125
Unit Variable Cost (18,750) (25,675) (36,540) (61,225)
Contribution Margin 17,000 17,825 28,460 27,900
Microprocessors per car 20 25 32 50
Required
1. Determine the weekly contribution from each product when microprocessors are allocated to the product with the highest:
a. Unit selling price
b. Unit contribution margin
c. Contribution per microprocessor
2. Determine the net disadvantage to the manufacturer if management requires the weekly production of 12 Speedsters.

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Answer allocates all available microprocessors to the product with the highest unit selling price To determine the weekly contribution from each product we need to calculate the contribution margin fo... blur-text-image

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