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Discuss what is the maximum contribution margin garrison

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Reference no: EM131759515

The Garrison Company manufactures two products: Oxy Cleaner and Sonic Cleaner. The costs and revenues are as follows:

  Oxy Cleaner   Sonic Cleaner  
Sales Price $ 85   $ 48  
Variable cost per unit   45     25  

Total demand for Oxy is 11,200 units and for Sonic is 7,200 units. Machine time is a scarce resource. During the year, 62,000 machine hours are available. Oxy requires 5 machine hours per unit, while Sonic requires 2.5 machine hours per unit.

What is the maximum contribution margin Garrison can achieve during a year?

$613,600.

$1,297,600.

$1,066,400.

$517,600.

Reference no: EM131759515

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