Santorino Company Produces Two Models of a Component, Model K-3

question 107

Multiple Choice

Santorino Company produces two models of a component, Model K-3 and Model P-4.The unit contribution margin for Model K-3 is $6; 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.
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What is the amount of machine time for model P-4 in terms of percent of a machine hour?

• A) 10%
• B) 20%
• C) 25%
• D) 30%
• E) 50%

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Definitions:

Light Intensity

The amount of light energy per unit of area, an important factor in the photosynthesis process and plant growth.

Cones

Geometric shapes that have a circular base and a single vertex.

Night Vision

The ability to see in low-light conditions.

Fine Detail

The intricate and precise features or aspects of something, often requiring close inspection or careful attention to be appreciated or understood.