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Eastwood Cake Factory sells chocolate cakes, birthday cakes, and specialty cakes. The factory is experiencing a bottleneck and is trying to determine which cake is
Eastwood Cake Factory sells chocolate cakes, birthday cakes, and specialty cakes. The factory is experiencing a bottleneck and is trying to determine which cake is most profitable. Even though Eastwood may have to limit its orders, it is concerned about customer service and satisfaction. Birthday Cake Specialty Cake Sales price Variable cost per cake Hours needed to bake, frost, and decorate Birthday cake Specialty cake Chocolate Cake 1st: $20.00 $5.00 2nd: 3rd: 1 hour $45.00 $12.00 a. Compute the contribution margin per hour per cake. If required, round your answers to two decimal places. Chocolate cake U 2.5 hours b. Determine which cakes the company should try to sell more of first, second, and then last. $60.00 $20.00 2 hours
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