Question

Calibri Company produces three products: F, G, and H. The selling price, variable costs, and contribution margin for the one unit of each product below:


One of two major machines used to produce these products has broken down and a new one is on backorder so the company is down to one machine. Product F takes 0.20 machine hours to produce one unit, Product G takes 11 machine hours to produce one unit, and Product H takes 2.5 machine hours. There are 1,000 machine hours available on the new machine.
a. What is the amount of contribution margin that will be obtained per machine hour on each product?
b. Which product would you recommend that the company work on next week—the orders for Product F, Product G, or Product H? Showcomputations.


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  • CreatedJuly 26, 2013
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