Question: 1)Heart-Felt Ltd. Makes three products. Relevant per unit data for each product is below. Books Pens Pencils Selling price $9 $12 $14 Variable costs and
1)Heart-Felt Ltd. Makes three products. Relevant per unit data for each product is below.
Books Pens Pencils
Selling price $9 $12 $14
Variable costs and expenses 3 9.50 12
Machine hours to produce 2 1 2
Assuming 1,500 additional machine hours are available, determine which product should be manufactured? Why?
Pens should be manufactured, since it has the highest contribution margin per the scarce resource
Pencils should be manufactured, since it has the highest contribution margin per the scarce resource
Books should be manufactured, since it has the highest contribution margin per the scarce resource
Books should be manufactured, since it has the highest contribution margin per unit
2)Heart-Felt Ltd. Makes three products. Relevant per unit data for each product is below.
Books Pens Pencils
Selling price $9 $12 $14
Variable costs and expenses 3 9.50 12
Machine hours to produce 2 1 2
Calculate the contribution margin per unit for Books?
| $12.00 | ||
| $6.00 | ||
| $2.50 | ||
| $3.00 |
3)Heart-Felt Ltd. Makes three products. Relevant per unit data for each product is below.
Books Pens Pencils
Selling price $9 $12 $14
Variable costs and expenses 3 9.50 12
Machine hours to produce 2 1 2
Calculate the contribution margin per unit for Pens?
| $12.00 | ||
| $21.50 | ||
| $2.50 | ||
| $2.00 |
4)Heart-Felt Ltd. Makes three products. Relevant per unit data for each product is below.
Books Pens Pencils
Selling price $9 $12 $14
Variable costs and expenses 3 9.50 12
Machine hours to produce 2 1 2
Calculate the contribution margin per unit of the limited resource for Pens?
| $1.26 | ||
| $2.50 | ||
| $3.00 | ||
| $2.00 |
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
Study Help