Question

Widgeon co. manufactures three products: bales, tales, and wales. the selling prices are $55, $78, and $32, respectively. the variable costs for each product are $20, $50, and $15, respectively. each product must go through the same processing in a machine that is limited to 2,000 hours per month. bales take 5 hours to process; tales 7 hours; and wales 1 hour. ​ the contribution margin per machine hour for tales is group of answer choices

O $4
O $7
O $28
O $35

Answer 1

The contribution margin per machine hour for the product Tales is calculated as $28 divided by 7 hours, resulting in a final answer of $4 per machine hour.

Step-by-step explanation:

The contribution margin per machine hour for the tale's product offered by Widgeon Co. is calculated by deducting the variable cost from the selling price and then dividing by the number of machine hours required to produce one unit. Specifically:

• Selling Price of Tales = $78
• Variable Cost of Tales = $50
• Machine Hours for Tales = 7 hours
• Contribution Margin = Selling Price - Variable Cost
• Contribution Margin per Machine Hour = Contribution Margin / Machine Hours

Therefore, the Contribution Margin for Tales is $78 - $50 = $28. Subsequently, the Contribution Margin per Machine Hour is $28 / 7 hours = $4.