Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and...
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Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity is 1,740 hours per year. Colt can sell up to 584 units of Hero and 872 units of Flip per year. Selling prices and variable costs follow. Selling price per unit Variable costs per unit Hero $ 156 52 Selling price per unit Machine hours per unit Contribution margin per unit Fixed costs Contribution margin per machine hour (a) Compute the contribution margin per machine hour for each product. Hero (b) Determine the best sales mix of products. Flip $ 98 56 Units produced and sold for most profitable sales mix Hours required to produce most profitable sales mix (c) Compute the total contribution margin for the best sales mix Units produced for most profitable sales mix Contribution margin per unit Hero Hero Flip Flip Flip Total Total Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity is 1,740 hours per year. Colt can sell up to 584 units of Hero and 872 units of Flip per year. Selling prices and variable costs follow. Selling price per unit Variable costs per unit Hero $ 156 52 Selling price per unit Machine hours per unit Contribution margin per unit Fixed costs Contribution margin per machine hour (a) Compute the contribution margin per machine hour for each product. Hero (b) Determine the best sales mix of products. Flip $ 98 56 Units produced and sold for most profitable sales mix Hours required to produce most profitable sales mix (c) Compute the total contribution margin for the best sales mix Units produced for most profitable sales mix Contribution margin per unit Hero Hero Flip Flip Flip Total Total
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