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Marsellus Electronics manufactures two tablet devices, the Cub, and the Eagle. Cub Variable cost per unit $150 Selling price $175 Eagle Variable cost per unit

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Marsellus Electronics manufactures two tablet devices, the Cub, and the Eagle. Cub Variable cost per unit $150 Selling price $175 Eagle Variable cost per unit $450 Selling price $575 Currently Marsellus sells 1,000 Cub and 400 Eagle tablets. Given this information which of the following is an INCORRECT recommendation? c) While the Cub has a lower contribution margin it still covers direct costs d) While the Cub has a lower contribution margin it has a much higher volume of sales b) While the Cub has a lower contribution margin there are qualitative factors to take into account a) The Cub should be dropped due to the substantially lower contribution margin

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