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vodomira [7]
2 years ago
12

Santorino Company produces two models of a component, Model K-3 and Model P-4. The unit contribution margin for Model K-3 is $6;

the unit contribution margin for Model P-4 is $14. Each model must spend time on a special machine. The firm owns two machines that together provide 4,000 hours of machine time per year. Model K-3 requires 15 minutes of machine time; Model P-4 requires 30 minutes of machine time. What is the contribution margin per unit of scarce resource (machine time) for Model K-3?
Business
1 answer:
tresset_1 [31]2 years ago
7 0

Answer:

Contribution per unit of scare resource (in hour) = $24 per hour

Explanation:

The question falls under the limiting factor analysis

<em>When a business is faced with a problem of shortage of a resource which can be used to produced more than one product type, to maximize the use of the resource , the business should allocate it for production purpose in such a way that </em><em>it maximizes the contribution per unit of the scare resource.</em>

Therefore Santario Company should allocate the machine hours to maximize the contribution per unit of machine hour.

Contribution per unit of scare resource is determine as follows:

Contribution per unit of scare resource for Model K-3

Contribution per unit of Model K-3 = $6

Machine time per unit =  15 minutes

<em>Contribution per unit of scare resource in minutes</em>

=Contribution per unit/Machine time per unit

= 46/15 minutes

= $0.4 per minute

Contribution per unit of scare resource (in hour)

$0.4 per minutes× 60

= $24 per hour

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5 0
1 year ago
Packard Corporation reports the following information: Net cash provided by operating activities $335,000 Average current liabil
Molodets [167]

Answer:

$165,000

Explanation:

Free cash flow is the net cash cash flow available for the shareholders or for the reinvestment after paying all capital expenditure.

The Depreciation is already adjusted in the Cash Flow from operating activities.

Free Cash Flow = Cash Flow from operating activities - Dividend payment - Capital expenditure

Free Cash Flow = $335,000 - $60,000 - $110,000 = $165,000

Current and Long term liabilities has nothing to do in free cash flow calculations.

4 0
3 years ago
Privo Co. purchases a machine that cost $15,000. Privo estimates a 5-year life with no salvage value. The first three years of d
Ierofanga [76]

Answer:

Double-declining balance method

Explanation:

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= One ÷ useful life

= 1 ÷ 4

= 20%

Now the rate is double So, 40%

In year 1, the original cost is $15,000, so the depreciation is $6,000 after applying the 50% depreciation rate

And, in year 2, the depreciation is ($15,000 - $6,000) × 40% = $3,600

And, in year 3, the depreciation is ($15,000 - $6,000 - $3,600) × 40% = $2,160

6 0
3 years ago
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Y_Kistochka [10]

Answer:

C. active monetary policy potentially destabilizes the economy.

Explanation:

5 0
2 years ago
To say that "the U.S. public debt is mostly held internally" is to say that:_______ a. the bulk of the public debt is owned by U
Triss [41]

Answer: The correct answer is "a. the bulk of the public debt is owned by U.S. citizens and institutions.".

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5 0
3 years ago
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