Coco Commodity manufactures three different product lines, Model C1, Model C2, and Model C3. Considerable market demand exists for all models. The following per unit data apply:

	Model C1	Model C2	Model C3
Selling price	$80	$90	$100
Direct materials	30	30	30
Direct labour ($10 per hour)	15	15	20
Variable overhead costs ($5 per machine-hour)	5	10	10
Fixed overhead costs	20	20	20

Required:

a) For each model, compute the contribution margin per unit.

b) For each model, compute the contribution margin per machine-hour.

c) If there is excess capacity, which model is the most profitable to produce? Justify your answer.

d) Assume that a machine breakdown has limited total available machine hours to 250. In addition, the recent release of a competitors product has limited demand for C2 to 50 units. Determine the optimal product mix for Coco Commodity.