Common Chemical Companys management is evaluating its product mix in an attempt to maximize profits. For the

Common Chemical Company’s management is evaluating its product mix in an attempt to maximize profits. For the past two years, Common has produced four products, and all have large markets in which to expand market share. Common’s controller has gathered data from current operations and wants you to analyze them for him. Sales and operating data follow.

*Common’s scarce resource, machine hours, is being used to full capacity.

Required
1. Compute the machine hours needed to produce one unit of each product. (Round to two decimal places.)
2. Determine the contribution margin per machine hour for each product.
3. Which product line(s) should be targeted for market shareexpansion?

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Product A1 Product B7 Product C5 Product D9 Variable production costs $71,000 91,000 $91,920 $97440 Variable selling costs Fixed production costs Fixed administrative costs 3,400 Total sales $5,400 $12,480 $30,160 $20,400 21,600 29,120 $18,480 6,240 $10,080 $122,000 $136,000 $156,400 $161,200 $10,200 $5,400 Units produced and sold 85,000 45,000 26,000 14,000 Machine hours used* 17,000 18,000 20,800 16,800