Magnitude Company produces A and B with contribution margins per unit of $40 and $30, respectively. Only 500 labor hours and 300 machine hours are available for production. Time requirements to produce one unit of A and B are as follows:
What is the constraint on machine hours for Magnitude Company?
A) 1A + 4B £ 300
B) 5A + 2B £ 500
C) 1A + 4B £ 500
D) 40A + 30B £ 500

Question

Magnitude Company produces A and B with contribution margins per unit of $40 and $30, respectively. Only 500 labor hours and 300 machine hours are available for production. Time requirements to produce one unit of A and B are as follows:
 What is the constraint on machine hours for Magnitude Company?
A) 1A + 4B £ 300 
B) 5A + 2B £ 500 
C) 1A + 4B £ 500 
D) 40A + 30B £ 500

Quizplus · Accepted Answer

The Answer of Magnitude Company produces A and B with contribution margins per unit of $40 and $30, respectively. Only 500 labor hours and 300 machine hours are available for production. Time requirements to produce one unit of A and B are as follows:
 What is the constraint on machine hours for Magnitude Company?
A) 1A + 4B £ 300 
B) 5A + 2B £ 500 
C) 1A + 4B £ 500 
D) 40A + 30B £ 500

Magnitude Company Produces a and B with Contribution Margins Per