## (Solution Download) Exercise 6-11 Spencer Company manufactures and sells three products. Relevant per unit data concerni

Exercise 6-11

Spencer Company manufactures and sells three products. Relevant per

unit data concerning each product are given below.

 Product A B C Selling price \$8 \$12 \$15 Variable costs and expenses \$3 \$10 \$12 Machine hours to produce 2 1 2

(1) Compute the contribution margin per unit of

the limited resource (machine hours) for each product.

(Round contribution margin per unit to 2 decimal

places, e.g. 1.25.)

 Product A Product B Product C Contribution margin per unit of limited resource \$ \$ \$

(2) Assuming 1,500 additional machine hours are

available, which product should be manufactured? Product AProduct BProduct C

Prepare an analysis showing the total contribution margin if the

(1) Divided equally among the products.

(Round contribution margin per unit to 2 decimal

places, e.g. 1.25.)

 Product A B C Machine hours Contribution margin per unit of limited resource \$ \$ \$ Total contribution margin \$ \$ \$

 The total contribution margin \$

(2) Allocated entirely to the product identified

above.

 Machine hours Contribution margin per unit of limited resource \$ Total contribution margin \$

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