Kitchen Convenience Company manufactures two productslong dashtoaster ovens and bread machines. The following data are available: Toaster Ovens Bread Machines Sales price $ 100 $ 140 Variable costs $ 60 $ 50 Kitchen Convenience can manufacture six toaster ovens per machine hour and four bread machines per machine hour. Kitchen Convenience's production capacity is 1 comma 600 machine hours per month. What is the contribution margin per machine hour for bread machines?

Question

Gwendolyn

Business

22 May, 00:49

Kitchen Convenience Company manufactures two productslong dashtoaster ovens and bread machines. The following data are available: Toaster Ovens Bread Machines Sales price $ 100 $ 140 Variable costs $ 60 $ 50 Kitchen Convenience can manufacture six toaster ovens per machine hour and four bread machines per machine hour. Kitchen Convenience's production capacity is 1 comma 600 machine hours per month. What is the contribution margin per machine hour for bread machines?

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Answers (1)

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Holly Snyder · Answer 1

Contribution margin per hour = $360

Explanation:

Giving the following information:

Bread Machines:

Sales price = $140

Variable costs = $50

Contribution margin per unit = $90

Kitchen Convenience can manufacture four bread machines per machine hour.

To calculate the total contribution margin per hour, we need to multiply the number of bread machines produced in an hour for the unitary contribution margin.

Contribution margin per hour = $90*4 units = $360