Answer:
(1) 12; 35; 54
(2) 24; 43.75; 33.75
Explanation:
Contribution margin per unit.
Economy $:
= Selling price - Variable costs and expenses
= 30 - 14
= 12
Standard $:
= Selling price - Variable costs and expenses
= 50 - 15
= 35
Deluxe $:
= Selling price - Variable costs and expenses
= 100 - 46
= 54
Ignoring the machine time constraint, Tanek Industries should produce Delux
Contribution margin per limited resources:
Economy$:
= contribution margin per unit ÷ Machine hours required
= 12 ÷ 0.5
= 24
Standard$:
= contribution margin per unit ÷ Machine hours required
= 35 ÷ 0.8
= 43.75
Deluxe$:
= contribution margin per unit ÷ Machine hours required
= 54 ÷ 1.6
= 33.75
The company should produce standard since it has highest contribution margin per unit of limited resource.