Question
Crook Corporation can sell all the units it can produce of either Plain or Fancy but not both. Plain has a unit contribution margin of
Crook Corporation can sell all the units it can produce of either Plain or Fancy but not both. Plain has a unit contribution margin of $240 and takes two machine hours to make and Fancy has a unit contribution margin of $300 and takes three machine hours to make. There are 2,400 machine hours available to manufacture a product. What should Brooks do?
A Make Fancy which creates $60 more profit per unit than Plain does.
B Make Plain which creates $20 more profit per machine hour than Fancy does.
C Make Plain because more units can be made and sold than Fancy.
D The same total profits exist regardless of which product is made.
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