ABC Corporation manufactures two styles of lamps?a Bedford Lamp and a Lowell Lamp. The following per unit data are available:

Total fixed costs are $30,000, and Company can sell a maximum of 10,000 units of each style of lamp annually. Machine hour capacity is 25,000 hours per year. What is the contribution margin per machine hour for the Lowell lamp?

A) $4 per machine hour

B) $2 per machine hour

C) $3 per machine hour

D) $12 per machine hour

Transcribed Image Text:

Sale price Variable costs Machine hours required for 1 lamp Bedford Lamp $25 $17 12 Lowell Lamp $35 $23 14 Sale price Variable costs Machine hours required for 1 lamp Bedford Lamp $25 $17 12 Lowell Lamp $35 $23 14

Answer rating: 100% (QA)

C 3 per machine hour Explanation ... View the full answer