Based the selling price per unit and the contribution margin, the contribution margin per machine per hour is $105 for Standard and $42 for Delux.
The total number of units to be produced are 162 units for Standard and 0 units for Deluxe. This will lead to a contribution margin of $17,010.
What is the contribution margin per machine per hour for Edge Company?
The contribution margin per machine per hour for Standard is:
= Contribution margin per unit / Number of machine hours per unit
= 105 / 1
= $105
For Deluxe is:
= 84 / 2
= $42
What is the ideal mix for Edge Company?
Producing Standard gives a higher Contribution Margin so the company should focus on this alone.
Number of units of Standard would be:
= Machine capacity per month / Number of hours required for Standard
= 162 / 1
= 162 units
The contribution margin would be:
= 162 x x Contribution Margin per unit
= 162 x 105
= $17,010
Find out more on contribution margin per unit at https://brainly.com/question/18566923.
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