Calculating Margin Activity In the table, enter each product's price, material cost, and labor cost found in your report, and note whether or not a second shift was used (Y/N). Then, use the values you entered to calculate the Contribution Margin and the Margin Percentage. Current Margin Product Name Price Material Cost Labor Cost Second Shift (Y/N) Contribution Margin ($) Contribution Margin (%) Cake 0 0 0 0 0

Calculate the minimum Material Cost per segment using the minimum material cost equation: Minimum Material Cost = [(Lowest Acceptable MTBF * 0.30) / 1000] + Trailing Edge Material Cost

Minimum Labor Cost

Calculate the minimum Labor Cost for each segment. Assume a base labor cost of $11.20 ($11.20 is a rough estimate of labor cost used solely to illustrate the Margin Potential Concept). Minimum Labor Cost = [$11.20 - (1.12 * Automation Ratings Below)] + 1.12

Customer Segment Information
Segments	Trailing Edge Material Cost	Leading Edge Material Cost	Lowest Acceptable MTBF	Maximum Price	Automation Level (out of 10)
Low Tech	$1.50	$8.50	14,000	$35.00	10.0
High Tech	$4.00	$10.00	17,000	$45.00	6.0

Margin Potential
Product	Name	Maximum Price	Minimum Material Cost	Minimum Labor Cost	Contribution Margin ($)	Contribution Margin (%)
Low Tech					Incorrect value entered
High Tech