Managerial Accounting

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Rosey Partners: Contribution Margin


Rosey Partners makes three products that are all in high demand. The costs per unit for the most recent period are shown below.

Model A Model B Model C
Sales price \$160 \$180 \$200
Direct materials \$60 \$60 \$60
Variable labor and overhead \$30 \$30 \$40
Fixed overhead \$40 \$40 \$40
Machine hours used 3.5 4 2.5

What is the HIGHEST contribution margin per machine-hour of these three products?