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Waterway Industries can sell all the units it can produce of either Plain or Fancy but not both. Plain has a unit contribution margin
Waterway Industries can sell all the units it can produce of either Plain or Fancy but not both. Plain has a unit contribution margin of $70 and takes two machine hours to make and Fancy has a unit contribution margin of $93 and takes three machine hours to make. There are 2700 machine hours available to manufacture a product. What should Waterway do? O Make Plain which creates $4 more profit per machine hour than Fancy does O Make Fancy which creates $12 more profit per unit than Plain does. O Make Plain because more units can be made and sold than Fancy. O The same total profits exist regardless of which product is made.
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