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Duo Company manufactures two products, Uno and Dos. Contribution margin data follow. Uno Dos Unit sales $ 15.00 $ 36.00 Less variable cost: Direct material
Duo Company manufactures two products, Uno and Dos. Contribution margin data follow.
Uno | Dos | ||||||
Unit sales | $ | 15.00 | $ | 36.00 | |||
Less variable cost: | |||||||
Direct material | $ | 7.00 | $ | 6.00 | |||
Direct labor | 1.00 | 5.00 | |||||
Variable overhead | 1.25 | 9.50 | |||||
Variable selling and administrative cost | .75 | .50 | |||||
Total variable cost | $ | 10.00 | $ | 21.00 | |||
Unit contribution margin | $ | 5.00 | $ | 15.00 | |||
Duo companys production process uses highly skilled labor, which is in short supply. The same employees work on both products and earn the same wage rate. Required: 1. Calculate the contribution margin per scarce resource for each of the products assuming an arbitrary time period for which direct laborers earn $1.00 per unit. 2. Which of Duo Companys products is most profitable?
Complete this question by entering your answers in the tabs below. Required 1 Required 2 Calculate the contribution margin per scarce resource for each of the products assuming an arbitrary time period for which direct laborers earn $1.00 per unit. Uno Dos Complete this question by entering your answers in the tabs below. Required 1 Required 2 Which of Duo Company's products is most profitable? Which of Duo Company's products is most profitableStep by Step Solution
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