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Problem 25-3A (Algo) Sales mix strategies LO P3 Edge Company produces two models of its product with the same machine. The machine has a
Problem 25-3A (Algo) Sales mix strategies LO P3 Edge Company produces two models of its product with the same machine. The machine has a capacity of 154 hours per month. The following information is available. Selling price per unit Standard $140 Deluxe $170 Variable costs per unit 55 102 Contribution margin per unit $ 85 $68 Machine hours per unit 1 hour Maximum unit sales per month 500 units 2 hours 200 units Required: 1 Determine the contribution margin per machine hour for each model Product Contribution Margin Contribution margin per unit Standard Deluxe Contribution margin per machine hour 2 How many units of each model should the company produce? How much total contribution margin does this mix produce per month?
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