Alpha Company Produces Two Models of a Component: Model K-3

question 112

Multiple Choice

Alpha Company produces two models of a component: Model K-3 and Model P-4. The unit contribution margin for Model K-3 is $6, and the unit contribution margin for Model P-4 is $14. Each model must spend time on a special machine. The firm owns two machines that together provide 4,000 hours of machine time per year. Model K-3 requires 15 minutes of machine time; Model P-4 requires 30 minutes of machine time.
-Refer to the Figure.What is the contribution margin per unit of scarce resource (machine time) for Model P-4?

• A)$12
• B)$14
• C)$24
• D)$28

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Definitions:

Openness

A personality trait or organizational culture characterized by transparency, willingness to share ideas, and receptiveness to new information.

Employee Relations

The management of relationships between employers and employees, aiming to establish and maintain productive, engaging, and harmonious work environments.

Organizational Culture

The core beliefs and assumptions that are widely shared by all organizational members.

Benefits Administration

The process by which an organization manages and organizes employee benefits, including insurance, retirement plans, leave policies, and other perks.