Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 10 Sep 2017 My Price 7.00

Timepiece Products

Dropping a product line. Timepiece Products, a clock manufacturer, operates at capacity. Constrained by machine time, the company decides to drop the most unprofitable of its three product lines. The accounting department came up with the following data from last year’s operations:

 

Manual

Electric

Quartz

Machine Time per Unit ............................................................................

Selling Price per Unit ..............................................................................

0.4 Hour

$20

2.5 Hours

$30

5.0 Hours

$50

Less Variable Costs per Unit ..................................................................

10

14

28

Contribution Margin .................................................................................

$10

$16

$22

Which line should Timepiece Products drop? (Hint: Compute the contribution per machine hour because machine time is the constraint.)

Answers

Maurice Tutor
(5)
Status NEW Posted 10 Sep 2017 01:09 PM My Price 7.00

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