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What is the total contribution margin for product a

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Reference no: EM133176744

Question - IKS has a production capacity of 5,000 hours that can be used to produce either A or B products. The following data is available:

 

Product A

Product B

Unit selling price

27$

30$

Unit raw material

9$

7$

Direct labor (variable) per unit

5$

5$

Indirect manufacturing costs variable per unit

3$

6.50$

Fixed indirect manufacturing costs per unit

7$

5$

Production time

2 heures

0.5 heures

Required - If the firm chooses to manufacture only A, what is the total contribution margin for product A given the constraint (5,000 hours)?

Reference no: EM133176744

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