Springer Products manufactures three different product lines, Model X, Model Y, and Model Z. Considerable market demand exists for all models. The following per unit data apply:

If there is a machine breakdown, which model is the most profitable to produce?
A) Model X
B) Model Y
C) Model Z
D) Both Model X and Model Y have same and highest profitability

Question

Springer Products manufactures three different product lines, Model X, Model Y, and Model Z. Considerable market demand exists for all models. The following per unit data apply:

If there is a machine breakdown, which model is the most profitable to produce?
A) Model X 
B) Model Y 
C) Model Z 
D) Both Model X and Model Y have same and highest profitability

Quizplus · Accepted Answer

Model X since it has the greatest contribution margin per machine-hour
Model X	$55 - $10 - $15 - $7 = $23 / 1 = $23 highest
Model Y	$69 - $10 - $15 - $14 = $30 / 2 = $15
Model Z	$78 - $10 - $30 - $14 = $24 / 2 = $12

Springer Products Manufactures Three Different Product Lines, Model X, Model