Question

The company can manufacture either two food processors per machine hour or three espresso machines per machine hour. The​ company's production capacity is​ 1,200 machine hours per month. What is the contribution margin per machine hour for food​ processors?

Answer 1

Answer:

The contribution margin per machine hour is $150.

Explanation:

Note: The missing part of the question is

                  Food Processor Espresso Machines

Sales price           $125                 $225  

Variable costs      $50                  $150

Solution

Contribution Margin per Machine = Sales Price - Variable Cost

=$125 - $50

=$75

Contribution Margin =   Contribution per Machine ×  Number of Machines Produced in 1 Machine Hour

=  $75 * 2

= $150

​Thus, the contribution margin per machine hour for food​ processors is $150.