The management of Rodwell Corporation has provided the following data concerning its two products—E99 and V09: The constrained resource is a particular machine that is available for 10,400 minutes each month. Each unit of product E99 requires 8 minutes on this machine. Each unit of product V09 requires 10 minutes on this machine.
-What is the maximum contribution margin the company can earn per month?
A)$17,280
B)$15,600
C)$20,520
D)$16,632

Question

The management of Rodwell Corporation has provided the following data concerning its two products—E99 and V09:  The constrained resource is a particular machine that is available for 10,400 minutes each month. Each unit of product E99 requires 8 minutes on this machine. Each unit of product V09 requires 10 minutes on this machine.
-What is the maximum contribution margin the company can earn per month?
A)$17,280 
B)$15,600 
C)$20,520 
D)$16,632

Quizplus · Accepted Answer

The maximum contribution margin the company can earn per month is $17,280. This is because the contribution margin per unit is $12, and the company can sell up to 1,440 units per month.

The Management of Rodwell Corporation Has Provided the Following Data