Edge Company produces two models of its product with the same machine. The machine has a capacity of 170 hours per month. The following information is available.
Standard Deluxe
Selling price per unit $220 $250
Variable costs per unit 95 150
Contribution margin per unit $125 $100
Machine hours per unit 1 hour 2 hours
Maximum unit sales per month 650 units 250 units
Required:
Determine the contribution margin per machine hour for each model.
Answers: 1
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