Question: Timepiece Products, a clock manufacturer, operates at capacity. Constrained by machine time, the company decides to drop the most unprofitable of its three product lines.

Timepiece Products, a clock manufacturer, operates at capacity. Constrained by machine time, the company decides to drop the most unprofitable of its three product lines. The accounting department came up with the following data from last year€™s operations:

Which line should Timepiece Productsdrop?

Manual 0.4 Hour2.5 Hours $20 Electric Quartz Machine Time per Unit Selling Price per Unit Less Variable Costs per Unit10 Contribution Margin 5.0 Hours S50 28 $10316S22 $30 14

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