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Duo Company manufactures two products, Uno and Dos. Contribution margin data follow. Unit sales Less variable cost: Uno Dos $13.00 $31.00 Direct material $
Duo Company manufactures two products, Uno and Dos. Contribution margin data follow. Unit sales Less variable cost: Uno Dos $13.00 $31.00 Direct material $ 7.00 $ 5.00 Direct labor 1.00 6.00 Variable overhead 1.25 7.50 Variable selling and administrative cost .75 .50 Total variable cost $10.00 $19.00 Unit contribution margin $ 3.00 $12.00 Duo company's 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: Which of Duo Company's products is more profitable? Explain.
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