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Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity
Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity is 1,940 hours per year. Colt can sell up to 704 units of Hero and 832 units of Flip per year. Selling prices and variable costs follow. Selling price per unit Variable costs per unit Hero $ 156 52 Flip $ 98 56 Answer is not complete. (a) Compute the contribution margin per machine hour for each product. Selling price per unit Variable costs per unit Contribution margin per unit Machine hours per unit Contribution margin per machine hour Hero Flip $ 156 $ 98 52 56 (b) Determine the best sales mix of products. Hero Units produced and sold for most profitable sales mix Hours required to produce most profitable sales mix 704 2 Flip 1,940 Total 832 834
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