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Author Question: Canary's Products Inc. manufactures three different product lines, Basic, Better, and Best. ... (Read 49 times)

haleyc112

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Canary's Products Inc. manufactures three different product lines, Basic, Better, and Best. Considerable market demand exists for all models. The following per unit data apply:

BasicBetterBest
Selling price$170$190$210
Direct materials606060
Direct labor ($20 per hour)303040
Variable support costs ($10 per machine-hour)102020
Fixed support costs404040

a.For each model, compute the contribution margin per unit.
b.For each model, compute the contribution margin per machine-hour.
c.If there is excess capacity, which model is the most profitable to produce? Why?
d.If there is a machine breakdown, which model is the most profitable to produce? Why?
e.How can Canary encourage its sales people to promote the more profitable model? 


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Marked as best answer by haleyc112 on Mar 6, 2021

Kdiggy

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haleyc112

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Reply 2 on: Mar 6, 2021
Wow, this really help


ricroger

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Reply 3 on: Yesterday
Excellent

 

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