Reference no: EM132617499
The Kadita Company produces three products with the following costs and selling prices:
Product A B C
Selling price per unit ...................... P15 P20 P20
Variable cost per unit..................... P8 P10 P12
Direct labor hours per unit............. 1 1.5 2
Machine hours per unit.................. 3.5 2 2.5
Problem 1: If Madison has a limit of 10,000 direct labor hours but no limit on machine hours, then the three products should be produced in the order:
Problem 2: What would be the total contribution margin if we follow the answer in number 1.
Problem 3: If Madison has a limit of 15,000 machine hours but no limit on direct labor hours, then the three products should be produced in the order:
Problem 4: What would be the total contribution margin if we follow the answer in number 3.
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