Question

Myosot Company produces two models of a component, Model K-3 and Model P-4. The unit contribution margin for Model K-3 is $12; the unit contribution margin for Model P-4 is $20. Each model must spend time on a special machine. The firm owns two machines that provide 6,000 hours of machine time per year together. Model K-3 requires 24 minutes of machine time; Model P-4 requires 36 minutes of machine time.What is the amount of machine time for model K-3 in terms of percent of a machine hour?a. 12%

b. 24%
c. 36%
d. 40%
e. 66%

Answer 1

D.40%

Step-by-step explanation:

The computation of the mount of machine time for model K-3 in terms of percent of a machine hour is shown below:

= (Model K-3 ÷ Machine Hour) ×100

= (24 minutes ÷ 60 minutes) ×100

= 40%

As the machine hours contain 60 minutes so we divide the model k-3 required time by the machine hour so that the percent of machine hour could come