Bill Miller's Corporation makes two types of widgets for use in various products. Operating data and unit cost information for its products are presented next.

Bill Miller's has 40,000 productive machine hours available. The relevant contribution margins, per machine hour for each product, to be utilized in making a decision on product priorities for the coming year, are
Product A __________Product B
a. $17.00........................$14.00
b. $18.50........................$16.00
c. $20.00........................$10.00
d. $37.00........................$24.00

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Product A Product B Annual unit capacity 10,000 20,000 Annual unit demand 10,000 20,000 S100 $80 Selling price Variable manufacturing 53 45 cost Fixed manufacturing cost 10 10 Variable selling and 10 11 administrative Fixed selling and administrative 4 Fixed other administrative 2 Unit operating profit $20 $10 Machine hours per unit 2 1.5