Unit contribution margin and contribution per labor-hour

Reference no: EM1341514

Unit contribution margin, contribution per labor-hour

Comfy Fit Company makes three sizes of shirts, small, medium and large, on one assembly line that has a limit of 600 labor-hours per week. Comfy Fit Company can seel all the shirts it can make under current operating capacity. Manufacturing information per shirt for each product is as follows:

Small Medium Large
Selling price $8 $12 $15
Variable costs 5 6 10
Labor hours per shirt 0.3 0.5 1.0

Requirements:

Find the weekly contribution margin when all labor-hours are allotted to the product with the highest:

a. unit selling price.

b. unit contribution margin

c. contribution per labor-hour

Reference no: EM1341514

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