Davis, Managerial Accounting, 2e MANAGERIAL ACCT (A Gradebook ORION CALCULAT Mul

Question

Davis, Managerial Accounting, 2e MANAGERIAL ACCT (A Gradebook ORION CALCULAT Multiple Choice Question 128 Sky Mountain Bakery makes doughnuts, cupcakes, and scones that are in high demand by local restaurants and hotels. Following is information for each of these Doughnuts Cupcakes Scones $1.60 s Selling price per item Variable cost per item Contribution margin per item Machine hours per item $2.20 1.50 $.60- $2.25 1.00 $1.30 14 Sky Mountain has 2,000 machine hours available each month. Demand for each item exceeds Sky Mountain's capacity to produce the item. In order to maximize the company's total contribution margin, in what sequence should Sky Mountain fill orders for the three products? Cupcakes first, then doughnuts, then scones. Scones first, then doughnuts, then cupcakes Doughnuts first, then scones, then cupcakes Scones first, then cupcakes, then doughnuts LINK TO TEXT

Explanation / Answer

Contribution margin per machine hour :

so answer is b) Scones first, Then doughnuts, then cupcakes

Doughnuts Cupcakes Scones Contribution margin per unit 0.60 0.70 1.30 Machine hour per unit 0.10 0.14 0.20 Contribution margin per hour 6 5 6.5 Rank 2 3 1

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.