Business, 04.04.2020 01:55, irlShadow

Anne Sugar makes large ceramic pots for use in outdoor landscaping. She currently has two models, one square and the other round. Because of the size of Anne’s creations, only one pot can be fired in the kiln at a time. Information about each model follows:

Square Round
Sales price $ 70 $ 90
Variable cost $ 15 $ 20
Firing time 2.5 hours 3.5 hours

Assume that Anne can sell as many pots as she can create but that she is limited as to the number of hours that the kiln can be run.

Square Ceramic Pot Round Ceramic Pot
Contribution Margin per Unit
Contribution Margin per Hour

Compute the contribution margin per unit and contribution margin per hour of firing time.

Answers: 3

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Anne Sugar makes large ceramic pots for use in outdoor landscaping. She currently has two models, on...