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28 November, 04:33

Healthier Living 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 $ 60 Healthier Living can manufacture six toaster ovens per machine hour and four bread machines per machine hour. Healthier Living'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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  1. 28 November, 05:00
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    Contribution margin per machine hour for bread machines = $320

    Explanation:

    From the question, the following can be deduced:

    Selling price Variable costs Contribution/unit

    Toaster Ovens $100 $60 $40

    Bread machines $140 $60 $80

    In each machine hour, six toaster ovens per machine hour and four bread machines are manufactured

    Total contribution margin per machine hour = 6*40+4*80 = $560

    Of which contribution margin per machine hour for bread machines = 4*80=$320
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