Murphy Company manufactures and sells three products. Relevant per unit data con

Question

Murphy Company manufactures and sells three products. Relevant per unit data concerning each product are given below. Product A B C Selling price $14 $17 $20 Variable costs and expenses $3 $6 $12 Machine hours to produce 2 1 2 Prepare an analysis showing the total contribution margin if the additional hours are divided equally among the products. Product A B C Machine hours Contribution margin per unit of limited resource $ $ $ Total contribution margin $ $ $ The total contribution margin is $ (2) Prepare an analysis showing the total contribution margin if the additional hours are allocated entirely to the product identified above. Product B Machine hours Contribution margin per unit of limited resource $ Total contribution margin $

Explanation / Answer

Product A Product B Product C Selling Price 14 17 20 Variable cost 3 6 12 Contribution 11 11 8 Machine hours 2 1 2 Contribution per machine hour 5.5 11 4

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